© Dukascopy Bank SA
In accordance with bearish forecasts of Dukascopy Community members last week, the Cable declined in its weekly value, as even supportive statistical data from the United Kingdom was not able to prevent the further appreciation of the US currency. More than 53% of traders expected such a development to take place. The currency pair, however, started the trading week on a rather positive note around the 1.5971 level and rose up to 1.6022 on November 5. However, on that date the UK services PMI data was released and used to be worse than expected at 56.2 points in October, meaning that activity growth in the most important sector of country's economy is slowing and puts under risk the pace of economic recovery that took place during last two years. However, the pair managed to regain its value on the same day, as US non-manufacturing PMI came out worse than forecasted too. On Thursday, the Bank of England kept its monetary policy unchanged, which drove the Pound down to 1.5840 versus the Greenback. The cross failed to recover considerably in the remaining part of the week, as it closed at 1.5877 on Friday.
This week, Dukascopy traders became even more bearish on the British currency's perspectives, as only 26.7% of all votes are set to go long on the GBP/USD currency pair at the moment. Despite that, the market is waiting for continuous improvement of the labor market in the UK, as jobless claims are estimated to decline, while unemployment rate is likely to fall below 6%. Moreover, traders are waiting for the Bank of England's inflation report on Wednesday. Additionally from the US side, several FOMC members will give their speeches during the new working week. The mean expectation for the Cable is placed around 1.59 major level; however, the majority of votes are located below this mark.
© Dukascopy Bank SA