The Pound battled to recover the significant losses from the past week, not garnering much support from Thursday’s economic data out of the UK.

Sterling edged down to a new 11-month low of $1.3388, with better-than-forecast GDP data doing little to support the Pound.

The Office for National Statistics stated the UK economy grew 0.6% in September as economic activity further rallied from August’s 0.40% growth, reports Pound Sterling Live.

That said, the data was, in the main, softer than most analysts had forecast. The UK economy grew 1.3% in Q3, under the expected 1.5%. Annual GDP stood at +6.6%, below the +6.8% forecast.

Elsewhere, the Dollar hit 20-month highs against the Euro and other currencies. Whilst the Yen moved down to 114.15 per Dollar, close to multi-year lows of 114.69 hit last month, after U.S. inflation data fuelled bets on interest rate hikes.

The Euro fell further to $1.1459 on Thursday, its lowest reading since July 2020, as the European Central Bank is seen as trailing on policy tightening.

Moreover, the Dollar rose 0.2% against a basket of currencies to 95.02, Reuters reports, its strongest since July last year. According to analysts, the rise in U.S. government bond yields drove the Dollar’s increase: “Whether investors will drive the EUR-USD drop towards the next support levels at around $1.1425 and $1.1380 will be the major test for the FX market today,” according to UniCredit analysts.

“However, this test will likely also depend on the further rise in long-term UST (U.S. Treasury) yields and the consequent additional widening of yield spreads between USTs and German Bunds.”

In addition, both the Australian and New Zealand Dollars moved down, dragged by weaker commodity prices. The Australian Dollar declined 0.4% to a one-month low of $0.7296, whilst the New Zealand Dollar dropped 0.4% at $0.7032.