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GBP/USD unable to clear $1.62
When the two members of the MPC decided to change their vote to yes from no, the economic picture for the UK was very strong. Arguably, that picture still remains good but the erosion of confidence and the weakening backlog of economic data from the eurozone will be playing on the MPC member’s minds.
As the eurozone remains our largest trading partner the demise of its recovery might not instantly be felt but will no doubt start to dent the UK’s figures in the fourth quarter.
GBP/USD traders will undoubtedly have been increasingly factoring in the chances that interest rate rises for the UK will be later in the year than had previously been envisaged. In the short term, the 50-day moving average and the $1.62 level appear to be a hurdle that cable will not be able to clear.