Forex Blog
Blog-FX.Com

At the Forex currency market the British Pound Sterling rate consolidates after sales

Forex forecast: MACD indicator for the pair GBP/USD is traded in the negative area and is going down moderately, while volumes are increasing, giving a sell signal.  Stochastic Oscillator has come back to the oversold zone, maintaining a sell signal.

Forex recommendations: The pair GBP/USD can go to 1.5430 as part of correction. There is a high chance that the pair will consolidate at the current levels.

Obviously, Pound looks weak as there have not been fundamental changes in economy.

The latest data showed that unemployment rate in the UK amounted to 5.0% in December, which agrees with the forecast. Level of unemployed people increased by 1.2 thousand against  forecast of growth of 7 thousand. It was also recorded that average weekly earnings, including bonuses, increased by 1.9% a month earlier against the rise of 1.8% in the previous reporting period.

Statistics released earlier demonstrated that economy of Great Britain is still under pressure and there are no factors which will help to improve it. Unsettled problems in Eurozone have reduced investors’ interest to the UK economy.

At the meeting which was held last week, the Bank of England left interest rate at 0.50% per annum, volume of securities repurchase was also kept unchanged at 275 billion pounds. In other respects, views of MPC remained unchanged: there is no need to revise interest rate; therefore the Bank will continue to monitor economy and inflation.

 It is worth noting that the Bank of England expects economic stagnation in Q4 2011 and GDP growth in Q1 2012. Revised GDP in the UK rose by 0.6% q/q (+0.5% y/y) in Q3.

Tags: