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The British Pound Sterling rate is traded downward at the Forex currency market on Friday, as the flow of negative factors is too strong. 

Forex forecast: MACD indicator for the pairGBP/USD is traded in the negative area and is moving along the signal line, notgiving a clear signal. Stochastic Oscillator is going down in the neutral zoneand is giving a sell signal.

Forex recommendations:  in case of breakdownat the level of 1.5480, targets for selling will be the levels of 1.5460 and1.5440. If downward breakdown does not take place, the pair will consolidate atthe current levels.

Sale of the GBP is still of emotional nature,as from the fundamental point of view, situation in the British economy isstable. Investors in the market are moving away from risks because of thethreat that European debt problem will expand. Meanwhile, the latest statisticsis quite positive. Thus, composite PMI in the UK increased to 53.2 points in December against the level of 51.2 points in November.

According to the data released yesterday, PMI in the construction sector rose to 53.2 points against expectations of 52points. In addition it became known in the middle of the week that net consumerlending amounted to 0.394 billion pound in November against the forecast of 0.3 billion pounds. Number of approved mortgage applications in the same monthin creased to 52.854 thousand against the previous level of 52.786 thousand. It became the maximal level since December 2009. 

The data released earlier showed that PMI CIPS in manufacturing sector increased to 49.6 points in December against 47.7points in November. The data is definitely positive; however the fact that theindex is below the level of 50 points proves that downward risks are still preserved. The Bank of England announced earlier that average inflationary expectations reduced to 4.1% in November against the level of 4.2% in August. At the same time, the level of two-year inflationary expectations was around 3.4% (3.5% previously).

It is also worth noting that the Bank ofEngland expects stagnation in the economy in the next quarter and GDP growth inQ1 next year. Revised GDP in the UK rose by 0.6% q/q (+0.5% y/y) in Q3,statistics released earlier has supported buyers. The index is above preliminary assessment, which was appreciated in the market. It became knownearlier that CPI in Great Britain increased by 0.2% m/m (+4.8% y/y), asexpected. Therefore, British inflation is slowing down its pace; however the index is still too far from the target level for the Bank of England.

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