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GBP/USD is trading at $1.6075, up 0.2%, after Bank of England governor Mark Carney confirmed the UK economy is improving, and therefore it is not necessary to increase the quantitative easing (QE) programme. The BoE has kept interest rates at historic lows for over four years, and is pumping £375 billion into the financial system. Economic indicators now point to a turnaround in the UK economy, and Mr Carney told the Yorkshire Post that the recovery is not confined just to the housing market, but is being felt by the economy as a whole.
At 1.30pm (London time), US personal income and spending figures are released, while Eric Rosengren of the Federal Reserve is due to a make an announcement. The pound jumped above the $1.61 level last week when the Fed decided to keep its stimulus package unchanged. As Mr Rosengren is known to hold dovish opinions, he is likely to recommend that the Fed again keeps its monetary policy unchanged, which could push the pound towards the $1.61 mark again.