GBP: British Pound Sterling resumed its growth after the fall on Thursday

At the Forex currency market the British Pound Rate is traded upward on Friday, regaining from yesterday’s sales.

Forex forecast: MACD indicator is in the positive area for the pair GBP/USD and it goes up, confirming a previous buy signal for the pair. Stochastic Oscillator is in the overbought zone, confirming this signal,   however, not ruling out a reversal trend.

Forex recommendations: if investors’ current sentiment will be maintained, buyers’ targets today will be the levels of 1.6175 and 1.6200. If sales will start for the pair, bears’ target will become the level of1.6060.

The UK statistics released today showed that houses prices Halifax increased by 0.8% m/m (-2.4% y/y). Market responded to the news favourably. 

Note that study of the National Institute of Economic and Social Researches “NIESR” agrees with the market sentiments. Thus, the Institute believes that the Bank of England can raise interest rate three times this year, with the main target to control the growth of consumer prices.

It is also expected that the rate will be raised to the level of 1.75% until the end of 2011 from the current values. The NIESR has also upgraded its inflation forecast to 3.8% for 2011 against the previous level of 2.8%. It is expected that unemployment rates will increase to 8.7% this year against the current level of 7.8%.

Earlier NIESR has already made not too rosy forecasts. Thus, the Institute recommended the UK government to postpone for some time a program of budget expenses reduction, since the strategy can bring huge losses in economy, rather than benefit. The statement made by the UK Prime-Minister Cameron earlier partly proves that this year will be extremely difficult for the country’s economy. We would remind that as it became known on Friday consumer confidence in the UK fell to -29 in January, as per GFK/NOP, against the previous level of -21. Thus, the index is at its lowest level since 1994, which indicates consumers’ skepticism regarding prospects of the economy in the nearest future.

Note that the pair GBP/USD has been in the narrow range at Forex for three days already.

 

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