The exchange rate of the pound/dollar pair fell to the level of 1.3765. The US currency is strengthening against most assets after falling last week. In the second quarter, the US economy showed high growth rates, and the corporate reporting season turned out to be a record. But then the situation began to deteriorate rapidly. The University of Michigan consumer sentiment index collapsed in August by a record in recent decades. Then in mid-August, weak retail sales figures for July were published, and in early September it became known about a noticeable deterioration in the situation on the US labor market. As a result of these events, the leading investment banks again began to lower their economic forecasts. In particular, Morgan Stanley lowered its forecast for US GDP growth in the third quarter from 6.5% to 2.9%. Goldman Sachs also lowered expectations for economic growth. The reason for such a deterioration in the economic situation will be a large-scale reduction in fiscal stimulus, which peaked in the second quarter. According to currency strategists, the pound may be trading in the range from 1.3700 to 1.3855 in anticipation of the September meeting of the Bank of England. The fall of the pound to the local minimum of 1.3725 on Wednesday was unexpected. Further weakening of the pound in the long term seems likely, although oversold indicators may limit any decline to the level of 1.3700.
The forecast assumes a decline in the pound/dollar pair to the values of 1.3740, 1.3720 and 1.3700.
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