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The British Pound Sterling rate is traded downward at the Forex currency market on Tuesday morning after negative news from Eurozone.

Forex forecast: MACD indicator for the pair GDP/USD is traded in the negative area, going down and giving a sell signal.  Stochastic Oscillator is going down in the neutral zone and is giving a similar signal.

Forex recommendations: in case of breakdown at the level of 1.5605 the target for selling will be the levels of 1.5590 and 1.5570.

Statistics released earlier showed that PMI index in the service sector MARKIT/CIPS soared to the level of 52.1 points in November against the forecast of 50.7 points. It became known earlier that PMI index in the manufacturing industry amounted to 47.6 points in November, as per CIPS/MARKIT estimates. The index is above expectations which supported growth of the Pound.

Activity in the British construction sector declined in November, which was demonstrated by statistics released at the end last week. According to Markit estimates, PMI CIPS amounted to 52.3 points in November against 53.9 points earlier; however dynamics in new houses is positive, and it upward trend can be interpreted as an indication of the future stabilization in the sector.

In general, the latest data from Markit looks good, as it does not rule out rapid recovery of economic sectors in the future.

Representative of the Bank of England Mr. Weale believes that economy of the country will not reach pre-crisis levels until Q3 2013, and growth of capital will support consumption. He believes that monetary policy alone cannot fix up economy and there is a high possibility that QE will be launched if the state of economy does not improve after the first round of stimulation. Weale also indicated that there are signs of new recession.

It became known last week that rating agency Fitch did not exclude the probability that the UK ranking could be downgraded, as national budgetary reserves have been rather depleted.  The agency believes that economic growth rate in the UK will slow down and influence of the European debt crisis will increase, which eventually will put in question current rating of the country.

According to NABE, unemployment rate in the UK will be around 8.7% in 2012 against previous forecast of 8.5%; there is a chance that employment will increase up to 100 thousand in Q4 this year. It is expected that policy of the Bank of England will continue to be soft next year and GDP will amount to 2.2% in Q1 next year against predicted level of 2.5% in Q4 this year.

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