The British currency is heading for the firstly weekly decline against the dollar in a month, after a report released today indicated a less significant service sector growth for the month of June.
The pound had a negative week overall as the British economy contracted beyond expectations in the first quarter, making it to lose ground against the euro, and versus the dollar, as the optimism towards the nations economy, which helped the pound to rise more than 10 percent since January against the greenback, failed to continue, as the facts indicate a deep and prolonged recession to follow for the United Kingdom. Adding to the current bearish scenario for the pound sterling, this Thursday, Bank of England policy maker David Miles affirmed that the U.K. banking sector remains in a very delicate situation, leaving space for speculations that difficult moments will continue to be frequent in the British financial system, shunning investors away of pound-priced assets.
A common opinion among traders leads to the fact that there is no more support for the pound to remain bullish against the dollar and the euro. After multiple negative domestic reports and news in the U.K., now, raising tensions regarding the global slump are pushing investors away from British assets, and the quarterly economic numbers are likely to maintain the pound down in the short term.
GBP/USD slid to 1.6314 as of 12:20 GMT from 1.6357 in the intraday. EUR/GBP raised to 0.8577 from 0.8535.
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