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At the Forex currency market the British Pound Sterling rate is traded upward on Wednesday, continuing yesterday's rise.

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; it is going up and is giving a buy signal. Stochastic Oscillator started to go up again and is giving a similar signal.

Forex recommendations: in case of breakdown at 1.5910, the pair will go to 1.5920 and 1.5950. A chance is high that the pair will consolidate at the current levels.

The Pound is guided by general sentiment of investors who expect prompt resolution of the Greek issue. In addition, the players have significantly reduced short positions in Euro/USD, due to their anticipations and the Pound is just going upward caught up in the movement of the major pair, and has reached the highs of this year already.

A meeting of the Bank of England will be held on Thursday, it is quite possible that comments of the MPC will be a little aggressive, as reaction to slowdown in British economy is expected from the Bank. 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.

According to estimates of the National Institute of Economic Research NIESR, British economy will lose 0.1% this year; however in 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. It became known earlier that consumer confidence index GfK rose up to -29 points in January against the level of -33 points in December. This is the record index since summer 2011 and is definitely very positive.

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