The UK Service PMI report for March showed an increase up to 55.3, thus exceeding the forecast (53.4).
The data suggest some economic recovery in Q1 2012. Therefore, the probability of the UK economy falling into recession is very low at this point, which leaves almost no hope for further quantitative easing in the near future. Experts are almost sure that the Bank of England won’t expand its QE program during the forthcoming MPC meeting scheduled for May. This is positive news for the British currency.
According to the currency strategists at UBS, the current weakness is just a correction. They recommend going bullish GBPUSD. The target is 1.6090, the stop-loss is set at 1.5835.
According to , GBPUSD has finished its 3-week rally. Sub-wave А(С)/С of Daily inside А/В of Weekly is completed. The MF pivot 1.5769 is the closest major level of support. A break above 1.5916 will resume the rally.
