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GBP still above average

GBP still above average

GBP weakened yesterday after disappointing figures from the UK’s manufacturing and industrial sectors and the trade deficit being higher than forecasted. Despite losing ground versus most currencies, Sterlings value is still above the average for the last three months.

Today we have the Bank of England’s monetary policy meeting. The MPC is not expected to introduce any changes either to interest rates or to the asset purchase program in the face of recent improvements in UK’s economic data.

As for the forward guidance on rates introduced by Mark Carney in August, the market believes that the MPC members are slowly realising it is not such a dependable tool as previously thought.

As predicted Barack Obama proposed current vice-chair Janet Yellen to be the next head of the US Federal Reserve. Despite much media coverage, Yellen’s appointment (pending only routine confirmation) is much overshadowed by the continued US Government shutdown and the looming October 17th potential US default.

 

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