Vlad Demochko
Paul Fisher, MPC member, is sure that the British economy will come out of the current recession in quarter 3 2012. At the same time, he expects the rate of inflation to be stable within the next 2-3 years and warns that the economic recovery will be rather slow.
The rate of inflation was around 2.5% in August. This is a 100% decline (y/y). Nevertheless, some members of the Bank of England assume that the inflation decline would have been much greater but for higher energy prices.
At the same time, Mr. Fisher warns about the risks coming from the Middle East. However, the negative factor have already been taken into account by the market and the rate of inflation will be declining so as to reach the 2% target level set by the Bank of England.
He says the Bank of England was right when deciding to expand the quantitative easing program up to £375 bn.
Forex.
According to , despite the fact that the British Pound is currently weakening against the US Dollar, GBPUSD still retains the long-term bullish trend. The experts say the currency pair is forming wave C or 4 against the uptrend.
The closest levels of support are 1.6095, 1.6070, 1.6030. The current bearish move will be completed as soon as the price overcomes the top of the MF sloping channel and consolidates above 1.6271 (as shown below).
Vlad Demochko
