Britain experienced another bearish trading session today following a series of reports which failed to meet expectations. The British economy has been struggling in the manufacturing and industrial sectors, which now appears to be spilling over into other aspects of economic well being.
Published today were several interconnected data sets. The first was the Nationwide House Price Index (HPI) which showed the housing market experiencing a pricing downturn of about 0.2% this past month. The news had pulled down on the pound sterling (GBP) initially but not heavily.
Shortly after the HPI data release, Britain published its Construction PMI which concurred with the notion expressed in the HPI figures; mainly that the housing market was in a slump. Falling far short of expectations, the HPI and PMI figures have so far pulled down moderately on the value of the British pound. But the bad news didn’t end there.
Many investors keeping an eye on Britain were expecting today’s net lending report to show modest growth in private loans. The actual figure published today, however, came well below expectations.
If you couple this information with the sluggish growth in the M4 money supply, it appears possible to add the housing and financial systems to the list of economic sectors faltering in the British economy. This spells bearishness for the GBP.
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Greg Holden is the Chief Market Analyst at ForexYard. Greg uses his detailed knowledge of fundamental and technical analysis to provide some of the leading market forecasts in the forex world today. A guest lecturer at forex symposiums and Chief Editor of ForexYard's analysis center, Greg brings highly detailed and easy-to-use market analyses to his clientele. He has been published on ForexYard's Trading Blog and affiliate websites. Greg holds degrees in Political Science and Economics from Missouri State University, as well as a Masters degree in Middle Eastern History.
