GBP/USD: Pound Counts on the Best.

As in the US, retail sales in the UK also went down. They fell -1.0% in December, which is significantly lower than the forecast +0.5%. Analysts note that real spending in the country was significantly ahead of GDP in 2020-2022, but the rise in inflation led to a sharp halt in this process. And it is predicted that 2023 will be a period of retribution for this waste.

According to economists at HSBC, one of the world’s largest financial conglomerates, things are not so bad. “With UK inflation likely to have peaked and could potentially slow more than the consensus forecast,” a less aggressive tone of tightening from the BoE now could mean a less dramatic reversal later in the year. And this may eventually become a minor positive factor for the British pound in the coming months. The shift towards better-than-expected domestic data should also be positive for the British pound.

In contrast to the EUR/USD flat trend, the British currency showed growth last week: GBP/USD approached the local December highs on January 18, reaching a height of 1.2435. Pound bulls are inspired by expectations that the Bank of England, in contrast to the fading activity of the Fed, on the contrary, will continue to vigorously tighten its monetary policy. It is predicted that from the current 3.50%, the rate may rise to 4.50 by summer. And an important day on this path may be February 02, when the next meeting of the BoE will take place.

The last chord of the week sounded at 1.2395. The median forecast for GBP/USD in the near future looks like this: 50% of experts believe that it is time for the pound to slow down its growth and are waiting for a correction to the south. Only 15% of experts side with the bulls, and 35% have taken a neutral position. Among the oscillators on D1, 85% are colored green, 15% signal that the pair is overbought.

Highlights for the UK economy in the coming week include Tuesday January 24, when a pool of UK business activity data will be released.