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GBP/USD weakens on QE expectations

By FXstreet.com,  June 28, 2012, 02:48:00 PM EDT

FXstreet.com (San Francisco) - Sterling is weaker against its U.S. counterpart this Thursday, fueled by the release of a slightly weaker Q1 GDP in the UK , increasing the likelihood of further easing from the BoE at its monetary policy announcement next Thursday, which has been a near term weight on GBP.

At the time of writing, GBP/USD is sliding to fresh 2-week lows ahead of the closing bell in New York, having broken below the 1.55 mark to fall as low as 1.5483 from 1.5566 late Wednesday, now recording a 0.5% loss on the day.

"The Bloomberg consensus expects the BOE to announce an expansion of £50 bln in gilt purchases," says Brown Brother's Harriman. "Recent data reports and comments from MPC members are further evidence that the BOE is likely to restart QE. We expect that sterling is likely to weaken against the dollar as the upside correction from June reverses."




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, Forex and Currencies

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