Pound Falls to New Lows as BoE Expects Recession

The Great Britain pound fell to its one-month low against the USD and to the 3-month low against the yen, following the comments of the country’s monetary officials and the global bearish trend for the riskier assets.
According to the interview given to The Times by Martin Weale (a member of the Monetary Policy Committee of the Bank of England), the risk of the continuation of the recession is quite strong and there are chances that the 4-quarter growth value may turn out negative in the UK. Today’s figures from the macroeconomic reports from over the world also indicate a slowdown in the recovery.
The analysts believe that the risk-aversion was already high enough for the pound to suffer a major drawdown, while the dovish commentaries by the Bank’s officials are just pulling it even farther down. The speculators will now have an additional stimulus to bet on a further depreciation of the sterling. Meanwhile, the stock market participants retreat from equities to the appreciating bonds.
GBP/USD fell from 1.5501 to 1.5472 as of 16:05 GMT today after hitting as low as 1.5372 earlier. GBP/JPY went down from 131.93 to 130.31, touching 128.79 during early trading session — the lowest level for the currency pair since May 25. EUR/GBP increased from 0.8159 to 0.8193.

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