After last week’s decline of GBPUSD, the British Pound showed a considerable rally. By now, the currency pair has made the weekly high at 1.5720. The British currency was supported by 2 major news releases, including the manufacturing production stats, which came out much better than expected, and the trade balance deficit, which managed to shrink considerably.
Rightmove HPI declined down to the 8-month low after losing 1.7%. This indicator suggests the current weakness of the UK housing market. At the same time, the CPI increased by 2.4%.
On Tuesday, Mervyn King, BOE Governor, made a speech in the Parliament. Right after his speech GBPUSD dropped down to May’s low t 1.5553. On Wednesday, the Bank of England released its MPC meeting minutes. They supported the current interest rates and the QE program (asset purchases - £375 bn). The rate of unemployment declined by 0.1% down to 8.1%.
Today, the UK authorities are to reveal their public borrowings. This report was disappointing in June, thus showing a more-than-expected deficit.
According to , despite a sound rally, the probability of GBPUSD resuming the downtrend is still rather high.
