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Home / Analytics / Forex analysis & forecasts / Forex Fundamental analysis / The pound is being pulled down
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The pound is being pulled down

The GBP/USD pair remains near many week lows, and the Bank of England protocol did not support the pound.

On Thursday, the British Pound remains under pressure. The GBP/USD pair managed to update a new low at 1.4361, but is trading slightly higher. However, while the turbulence in the currency market remains serious, there is a possibility of the pound updating its lows again.

Today the minutes of the previous meeting of the Bank of England were published. The document points to a number of risks for the British economy: for example, the lower-than-expected levels of labor productivity in the country. Moreover, wage growth has slowed down, and it has lowered inflationary pressures. Parameters of crediting are still going up, but even here the impulse does not look the strongest. Low rates were to accelerate the demand for credit products, but the British prefer not to take risks.

According to the BoE, in the fourth quarter of 2015 and the beginning of 2016 the local GDP increased by about 0.5%, although a more pronounced growth was expected. There are problems on the part of commodity prices, which are feeling the pressure because of the actions of OPEC, and the United States.

It is interesting that in the protocol of the Bank of England it is not excluded that a certain influence on the behavior of the sterling could have had the talk about the intention of Great Britain to raise the question of EU membership. It is rare, in fact, when the conservative Bank of England includes political commentary into the purely financial fabric.

The pound remains in a weak position, obviously, because the pressure from all sides is too big. At the same time, the UK economy actually looks quite stable.
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