GBP: British Pound increased sharply

At the Forex currency market the British Pound Sterling rate succeeded in rising from local lows on Tuesday and Wednesday.
 

Forex forecast: MACD indicator is crossing the signal line top-down for the pair GBP/USD, sell signal remains intact. At the same time volumes are insignificant indicating weakness of the signal. Stochastic Oscillator has entered the overbought zone today, maintaining a buy signal.

Forex recommendations: in case of current market sentiment maintenance and breakup at the level of 1.6340 the pair will move to 1.6350 and 1.6370.
Note that the pair GBP/USD started a sharp increase on the back of GBP/JPY growth amid Japanese currency’s weakness.
Thereby the increase looks unstable.

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 today, 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.

According to the Minutes of previous 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. Therefore, balance of forces in the Monetary Committee has remained unchanged, which frustrated bulls who expected indications of imbalance. Following the meeting of the Bank of England it became known that interest rate was kept at the previous level of 0.50% per annum, volume of debt securities was also left unchanged – 200 billion pound sterling.

The Bank of England will hold a meeting on Thursday this week, but is likely to leave the benchmark interest rate unchanged. Currently the key rate remains at 0.50% per annum.

 

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