Forex: GBP/USD – Sterling trading in narrow channel
iNVEZZ.com Wednesday July 10th: The pound has stabilized around 1.4900 with New York trading under way for the day. The pair has advanced almost 100 pips today after yesterday falling to a three year low at 1.4812 when the International Monetary Fund released a gloomy report on global economic growth and UK manufacturing was reported to have unexpectedly shrunk in May.
The IMF’s new World Economic Outlook trims the fund’s overall global growth projection for this year by 0.2 percent to 3.1 percent because of weakness in emerging market economies and ongoing problems in the developed economies. 2014’s growth forecast has also been revised downwards, by 0.2 percent to 3.8 percent.
Against the global trend, the IMF raises its 2013 growth forecast for the UK from 0.7 to 0.9 percent.
And there is positive news in updates for UK business optimism and services sector growth. London-based Markit Economics reports that the services sector grew at its fastest pace for two years in June and a British Chambers of Commerce survey puts British business confidence at a six-year high.
Separately, the National Institute of Economic and Social Research (NIESR) has estimated that the strong growth in the services sector means the UK economy as a whole grew by 0.6 percent in the second quarter, compared with 0.3 percent growth in the first three months of the year.