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GBP: British Pound goes down at the end of the week

At the Forex currency market the British Pound Sterling rate goes down on Friday, continuing yesterday’s dynamics and therefore, it had come out of the range and went downward. 

Forex forecast: MACD indicator is in the positive area for the pair GBP/USD and continues to move along the signal line, not giving a signal. Stochastic Oscillator continues to go down today and is giving a pair sell signal, being in the neutral zone.

Forex recommendations: if current sentiments will prevail at the market, and in case of breakdown at the level of 1.6120, traders’ targets will be the levels of 1.6075 and 1.6030/20.

It became known this morning that level of consumer confidence in Great Britain rose to -28 points in February, as per GfK/NOP estimates, against the previous value of -29 points. The news was moderately optimistic for the Pound; however it did not save the Pound from sales.

According to CBI which was released earlier, decline in sales volume from 37 points to 6 points is quite logical, as the program of reduction in public expenditure gave its first results. At the same time in the retail sector of the country the sentiments remains the most pessimistic since 2009.

Earlier a representative of the Bank of England Miles noted that according to regulator’s estimates the process of scrapping of the program of stimulation is quite slow. Miles believes that there is no need in monetary policy tightening as suggested by the supporters of the rate increase who keep eye on inflation levels. According to him, sharp tightening of the monetary policy will harm British economy, while inflation will revert to its key level of 2% by the year 2012.

The data on the public sector borrowing released on Tuesday inspired players, making it possible for the Pound to add about 20 pips, however it was not able to reverse general trend: the volume of net borrowing in Great Britain reduced to  STG5.252 billion in January against the level of -STG0.095 billion a year earlier. Statistics released earlier showed that index of houses prices Rightmove increased by 3.1% m/m (+0.3% y/y) in Great Britain. It is worth noting that different agencies, which monitor real estate market in the UK, use different indicators and as a result published data from time to time differs diametrically.

Meanwhile Friday’s statistics gave chance for the Pound to soar up: level of retail sales rose by 1.9% m/m (+5.3% y/y) in January against expectations of grow by 0.2% m/m; net mortgage lending in the UK remained  invariable in January, at the level of STG 1.2 billion.

 

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