The pound climbed the most in three weeks against the dollar after Britain’s economy expanded by more than analysts forecast in the third quarter, pulling the nation out of a recession.
U.K. government bonds fell as the strongest growth in five years prompted economists at Barclays Plc and Investec Securities to abandon forecasts for the Bank of England to expand its bond-buying program next month. Sterling advanced to a one-week high versus the euro after central bank Deputy Governor Charles Bean said the economy was “past its worst.”
“The pound is getting a boost from the GDP data coming in quite a bit above market expectations,” said Ian Stannard, head of European foreign-exchange strategy at Morgan Stanley in London. “We could now see the pound strengthening more, particularly against the euro.”