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The Sterling opened the week on a rather calm note, since expectations for upcoming rate hikes in the US and the UK lent equal support to both currencies. The pair was trading on a 1.560 note during European morning trade. In the middle of the week, the pair was strongly affected by the minutes of the Bank of England's latest policy meeting, which revealed a unanimous vote in favor of maintaining its monetary policy. Meanwhile, all nine members of the Monetary Policy Committee were in favor of leaving the key interest rate at a record low of 0.5% and making no changes to the central bank's 375 billion pounds asset-purchase programme. According to the BoE Governor Mark Carney, the decision to raise interest rates from record lows will come into sharper focus around the end of 2015, while most market players expect the BOE to begin slowly raising interest rates in the middle of 2016. The next day, the Sterling edged lower, due to the release of downbeat UK retail sales data declined by 0.2% last month, disappointing forecasts for a gain of 0.3%. Meanwhile, retail sales in May rose by 0.3%, whose figure was revised from a previously reported gain of 0.2%. At the end of the week, the unexpectedly weak US housing data pushed the pair down, but expectations for a higher interest rates continued to underpin demand for the pair. As a result, the trading week was closed at the 1.5517 mark.
Traders' predictions changed dramatically from the previous week, as now 71% of Dukascopy Community members are predicting the pair to decline. Alongside, the average forecast for the end of the week is placed around the 1.554 level. Speaking about the important events, on Wednesday, the UK to release data on net lending. A day later, the US is to produce preliminary data on second quarter growth and the weekly report on initial jobless claims.
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