GBP feels uncertain before Bank of England's meeting
The U.S. dollar has been performing badly against most major currencies on Tuesday as the risk appetite grew. Growth stocks and commodities, as well as good macroeconomic statistics helped the Dollar sales. Only the Australian dollar was unable to take full advantage of declining U.S. currency after the unexpected decision of the Reserve Bank of Australia, deciding to take a pause in the cycle of raising interest rates. The European currency managed to win back some losses against the Dollar. Retail sales in Germany rose in December by 0.8% m/m, but annually it remained in the negative territory at -2.5% y/y. Producer Price Index showed a slight increase of 0.1%, which was better than forecasts which also supported the strengthening of the Euro. In addition the European Commission decision over the Greek plan to reduce its budget deficit, increased optimism, affecting the Euro in a good way. The British pound strengthened alongside with the Euro, but the upcoming Bank of England's meeting due on Thursday, where a completion or expansion of the bonds redemption program must be decided over, introduces considerable uncertainty. Growing at the early European session on Wednesday, the Pound has then lost its positions and returned to the session opening level. The next meeting should be held by ECB on Thursday but there is nothing unexpected so the meeting will not bring the intrigue in.
