GBP: British Pound Sterling resumed its growth

At the Forex currency market the British Pound Sterling rate strengthened on Tuesday – traders came out of dollar positions in fear of expansion of QE2 program in the U.S.

Forex forecast: MACD indicator is in the negative area for the pair GBP/USD, however it tends to grow, giving grounds for a pair buy signal. Stochastic Oscillator is giving a similar signal, being in the neutral zone.

Forex recommendations?: if current external background is maintained and in case of breakdown at the level of 1.5775 the pair will go to 1.5820 and 1.5860.

It became known today that according to BRC estimations retail sales in Great Britain increased by 0.7% y/y in November.

Meanwhile, economists continue to make guesses in what European problems will turn out for the British economy. Chairman of the Independent British Control on budget execution Robert Choate noted yesterday that such effects have not been studied by the agency before. However, if Euro’s fall scenario   will represent signs of reality, experts are ready to explore the issue.

The area of discussion last week was British housing market – the data released on Wednesday showed that real estate prices in the UK declined by 0.3% m/m (+0.4% y/y) in November as per Nationwide,  while the forecast of reduction was by 0.4% m/m.

It became known earlier that the UK houses prices as per Hometrack, reduced by 0.8% on monthly basis (-1.1% y/y). The situation in the sector continues to be ambiguous. Earlier the LSL/Acadametrics estimations showed that houses prices in England and Wales went up by 0.3% in October, the rise is going on for the sixth consecutive month, increasing by 6.1% on annual basis; analytics in the real estate sector contradict one another: Halifax stated that houses prices in October increased by 1.8%, Nationwide insisted that the indicator fell by 0.7%.

Note that the Bank of England meeting will be held this week; interest rate decision and comments on the current economic situation will be made at the meeting. Interest rate of the Bank of England is now at the level of 0.5% per annum and the next meeting of the regulator is scheduled for 9 December. 

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