Fundamental review.
The pound was 0.5% higher versus the dollar. The Britain pound bought 1,6499 American dollar.
Last week a lot of the macroeconomic statistics and news was published in Great Britain. Many data carried a negative shade.
- U.K. inflation continued to fall in May but, not for the first time in recent months, the deceleration was much less sharp than expected. Hence, the CPI rose firmly by 0.6 % in comparison with April that, while largely seasonal, was enough to see just a 0.1 percentage point drop in the 12-month rate to 2.2 %. CPI inflation accordingly remains above its 2 % target.
- Recent comments from the BoE have been deliberately cautious about the U.K. economy's recovery prospects.
- Annual average earnings growth accelerated to 0.8 percent in the three months to April. The outcome, which followed a slightly smaller revised 0.3 % decline in March, was above expectations but still low enough to underline the lack of any significant inflationary pressure in the domestic labour market.
- The number of people out of work rose by a further 39,300 on the month to 1,544,800 in May. The rise, which was smaller than expected, lifted the jobless rate by 0.2 % points to 4.8 % from a weaker revised 4.6 percent in April.
- On the ILO measure, joblessness climbed by some 232,000 in the three month to April. The increase took the number out of work to 2,261,000 and lifted the jobless rate to a slightly lower than expected 7.2 %, still its highest level since the second quarter of 1997.
- Retail sales volumes were unexpectedly weak in mid-quarter when volumes fell 0.6 % from April to stand 1.6 % lower on the year.
My colleagues from FBS company and I keep frostily negative forecast on the British pound.