The strengthening of the British Pound against the Euro may hinder the economic recovery in the UK.
The British Pound is currently showing strength against the common currency and is nearing the 3.5-year high. Neither the latest money emission (£375 bn) nor lower export to the eurozone managed to prevent the strengthening of the British currency. Over the last 6 months, the Pound has already strengthened by 2.8% against the Euro.
According Nissay Asset Management, there is no point in waiting for a weaker Pound because the flight of capital for the eurozone continues and the UK currency is still popular with foreign investors.
The current state of affairs worries the experts of Capital Economics, the UK government’s hopes for economic recovery at the expense of European exports are vain because the British Pound will remain strong against the Euro over the next 16-18 months.
According to , GBPUSD continues the mid-term rally. The currency pair has just finished wave А(С) or shortened С of wave level Н1 inside a major upswing, represented by wave А/В of level Daily. A break above 1.5667 will continue the forming of wave А(С)/C. The closest levels of resistance are 1.5677 and 1.5707. A break below 1.5552 will indicate the end of the bullish move.
