Pounds Weakens on Pessimism Regarding British Economy

The Confederation of British Industry is expecting the economy to contract even further than previous forecasts, such pessimism brought the pound to a one-week low against the greenback.
Several reasons also brought the pound sterling down this Monday against the euro, yen, and the Swiss franc. A drop on bank shares combined with the CBI’s catastrophic expectation that the British GDP will decrease 3.9% this year were more than enough to make the pound hit the worst level in 7 seven days against virtually all major currencies. The United Kingdom is having its worse economic year since the Second World War, and 29,000 jobs in the financial sector are expected to be cut until December.
The negativity about the United Kingdom in trading markets is widespread, as analysts are not hoping for a short term recovery which could improve the price of British assets. The opinions are unanimously not favorable to the British economy or its currency, as the real estate market collapsed, stocks went down and the industrial production is reaching one record low after another. The pound sterling lost more than 25% against the U.S. dollar since the beginning of the last year, being that just a reflection of the current desperate situation in Britain.
The GBP/USD was traded at 1.4557 falling from last week’s closing price of 1.4785. In Europe the EUR/GBP went up from 0.8805 to 0.8895 and the GBP/CHF fell to 1.7056 from 1.7255. Finally the GBP/JPY was traded at 143.75 from 146.55.

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