The pound entered its fourth day of losses against the dollar and the euro, after British financial sector calls Bank of England to expand its asset purchasing program to revive the faltering economy in the United Kingdom.
The British Chambers of Commerce stated yesterday that the already expected economic recovery in Great Britain is not guaranteed and further measures should be taken immediately by the Bank of England, reflecting on the national stock exchange market and currency, the latter losing against virtually all major pairs, mainly to the U.S. dollar, the yen, and the Swiss Franc. According to the groups call for the asset-purchasing program expansion, the Bank of England should extend the current program to 150 billion pounds and eventually ask permission to go further, considering the U.K.s contracting economy needs. Factory production unexpectedly fell in May, adding to the already negative outlook for the pound sterling.
The quantitative easing measures asked by the British Chambers of Commerce may revive Great Britains economy, but on the currency point of view, the speculations regarding this fact already weigh on the pound, and if the measures continue further, its considerably possible that the pound will bottom against the euro and the U.S. dollar, yet, negative news in these markets make it hard to predict what direction the pairs will follow.
GBP/USD traded at 1.6225 as of 10:36 GMT rising from 1.6125 in the intraday, but still in a very low level considering last weeks rate around 1.6400. GBP/JPY remained stable at 154.53 after several days operating negatively.
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