GBP: British Pound continues to strengthen

At the Forex currency market the British Pound Sterling rate continues to strengthen on Friday.

Forex forecast: MACD indicator is rising in the positive area for the pair GBP/USD, giving a pair buy signal. It has pushed off the signal line earlier. Stochastic Oscillator remains in the overbought zone today, giving a similar signal.

Forex recommendations: in case current market sentiment preserves the pair will go to 1.6390 and 1.6420 at the end of the week.

BOE meeting the day before didn’t bring any surprises: the benchmark interest rate was left unchanged at the level of 0.50% per annum, volume of debt securities was also left unchanged – 200 billion pound sterling.

Current British currency strength calls forth USD’s weakness that is pressured by absence of decisions on budget.
According to the Minutes of the latest meeting of the Bank of England 6 members of MPC voted for keeping interest rate at the previous level. In addition, 8 people were for preserving current volume of the assets redemption program. Posen voted for the growth of QE by 50 billion pounds.

According to the BCC survey released the day before, 1q GDP in Great Britain is expected to come out at the level of 0.6-0.7%. Besides 1q sales among manufacturers may reach the level of +8 points against 4q level of +24 points, orders may decline to +22 points against +19 points seen previously.

1q sales among service providers are expected to come out at the level of +6 points against 4q level of +5 points, orders may grow to +5 points from -7 points seen previously.

According to the data released the day before, BRC Retail price index in Great Britain increased by 2.4% y/y in March against the increase by 2.7% y/y in February.

Important British statistics will be released April, 27 – 1q GDP that monetary officials hope to have grown by 0.7%. In case the economic growth is confirmed, interest rate in mid-term may be raised to 0.75% per annum.

 

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