We continue to hold our short GBP/USD position despite the pair rebounding off of technical support. Fundamentally, the Pound is a mess: declining industrial and manufacturing production; negative growth; deflation is a threat; unemployment remains high. The British economy is stagflating, and without a global turnaround, it is doubtful the Bank of England can engineer a recovery.These are the facts:
- the Fed Funds rate was expected to remain low for "an extended period."
- no more quantitative easing measures have been announced
- the inflation target will hinder the Fed's ability to inject substantially more liquidity
- British growth has turned negative; things are getting worse
Any other trade updates can be viewed in the real time news feed, or you can follow me on twitter at @CVecchioFX for trade thoughts and other macroeconomic musings.
