Forex Blog
Blog-FX.Com

At the Forex currency market the British Pound Sterling rate is traded slightly upward on Friday; however activity in the pair is low.

Forex forecast: MACD indicator for the pair GBP/USD has broken through the signal line from bottom to top and came into the positive area; however trades are sluggish and along the line; there is no a clear signal. Stochastic Oscillator came out of the overbought zone and started to give a sell signal.

Forex recommendations: in case of breakdownat 1.5810, the pair will go to 1.5800 and 1.5780. A chance is high that thepair will consolidate at the current levels.

According to estimates of the National Institute of Economic Research NIESR, British economy will lose 0.1% this year; how everin 2013 will resume its growth up to 2.3%. Situation with the households, that have a lot of debts and are not willing to spend money because of obscure economic outlooks, acts as a "hindrance" for the system. In addition, labor market also of importance, the Institute predicts that unemployment rate in 2012 will be over 9%. There is probability that inflation will drop to 2.2% from the current 4%, CPI can be at 1.4% in 2013.

We would remind that complex situation preserves in the labour sector. According to estimates, unemployment rate rose to 8.4% in November against the forecast of 8.3%, level of unemployed increased by 118 thousand over three months against +128 thousand in the previous three months. Situation is similar In the retail sector as well.

Realty in Britain is decreasing in price, according to Nationwide report, prices went down by 0.2% m/m in January, the decrease lasts for the second consecutive month. Although the data agreed with the forecast of economists, this fact is not very cheering. Thus, inflation in prices for houses in the country is really slowing down. We shall not fail to take into consideration that sharp changes in sentiments are obvious in the housing sector. This sector can show sideways trend in the coming months

It became known yesterday that consumer confidence index GfK rose to -29 points in January against the level of -33points in December. This is the record index since summer 2011 and is definitely very positive. According to the head of the Bank of England Mr.King, decline in inflation assumes possibility of additional QE; however, rates will likely remain at the current levels. King emphasized that recovery of the British economy will be slow and jerky. He also said that terms of lending are detrimental to economic recovery. At the same time the Bank of England is ready to provide liquidity to banks if a need will be.

Tags: