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The pound is sinking lower and lower

20.01.2016
The GBP/USD pair is trading with a significant decrease, as investors move away from possible risks.

The British Pound continued to fall on Wednesday. The current quote in the GBP/USD pair is 1.4154. The phase of the sharp weakening of the pound began on December 13 and since then sales do not cease.

Yesterday the "bears" were warmed by the comments from the Bank of England that the regulator does not have the dates of the re-pricing of the interest rate. The market expected a rise in mid-end of 2016, but now it is clear that the British regulator, as usual, will not hurry with resolute steps.

Today a block of statistical data came out on the employment market in the UK for November and December 2015. The unemployment rate in the UK in November, according to calculations by ILO, was 5.1% vs. expectations of 5.2%. Average earnings in the billing month added 2% while waiting for growth of 2.1%. In December, the number of applications for unemployment benefits fell by 4.5 thousand against the expectation of the growth of the rate by 2.5 thousand.

In total, the signals from the labor market are good, especially seasonally adjusted. However, at the moment market signals are much more important for the pound. The market is risk averse, and in this respect the pound is quite vulnerable. It is possible that market participants still keep in mind the theoretical probability of holding a referendum in the UK on the withdrawal from the EU. This plays against the attractiveness of the pound sterling, and it does not add stability.
 
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