GBP: British Pound determines movement direction after steady growth

At the Forex currency market morning the British Pound Sterling rate is between two fires on Tuesday morning: on the one hand interest in risk is clearly evident in the market, and this can push the pound upward; on the other hand British statistics holds back buying spree.

Forex forecast: MACD indicator for the pair GBP/USD remains in the positive area and is going down slightly, starting to shape a sell signal, while volumes are low. Stochastic Oscillator continues to go up in the neutral zone and is giving a buy signal.

Forex forecast: off the market.

Feasible event scenario at Forex: in case of break down at the level of 1.6415, the pair will go to 1.6430 and 1.6450. However, in case of the movement to 1.6390, target for sale will become the level of 1.6370.

Yesterday markets in the UK were closed, however statistics released this morning was disappointing: index of consumer optimism in the service sector of Great Britain fell by 29% in Q3, as per CBI estimates, against the growth of 10% in Q2. 

The Bank of England expected the growth of the index to the more optimistic levels in Q3 - statistics showed the opposite: optimism is fading away in the current quarter, and volume of business operations reduces in parallel.

Despite such gloomy indexes, CBI anticipates stabilization of the situation in Q4.

As it became known earlier net volume of borrowing in the public sector of Great Britain was at the level of -stg1.961 billion in July against the value of stg1.350 billion in June. In addition, other indices also showed that volumes of various public borrowings also went down, indicating fairly high level of effectiveness of the current economic programs.

Preliminary GDP in the UK increased by 0.2% on quarterly basis (+0.7% y/y) in Q2. The head of the Bank of England Mr. King noted this week commenting inflationary indices that, CPI can easily reach 5% and MPC can use interest rate or QE to control risks, if the need be.

Unemployment rater in the UK was at the level of 4.9% in July. At the same time, level of unemployed increased by 37.1 thousand. CPI in the UK fell by 0.1% m/m (4.2% y/y) in June against the forecast of growth by 0.2% m/m.

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