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There is unease out there regarding recent GBP/USD relapse to 1.25

Generally speaking the Bank of England has a history of never raising rates this close to Christmas, although they have delivered such a move once before in recent memory. However, it seems unlikely that will happen next Thursday this year. Perhaps the pound could do with such a move though, because in dollar terms it is well off the boil since rising above 1.27. The fall to test 1.25 on Friday is clear proof of that. As mentioned here earlier today, there is a lot of UK data due out tomorrow and on Wednesday. That will need to be strong, if the GBP/USD is to reverse this interim relapse. In addition, on the assumption the BOE will do nothing on Thursday, the rhetoric that accompanies such an outcome will need to drive home the current message- that UK interest rates are not coming off any time soon. There is also a short-term problem folks. A leading US global investment bank is today shouting sterling upside from the hills. That means only one thing; they are long and not happy with the current relapse. Talking it higher is often how they try to get themselves back on-side. The GBP/USD is currently trading at 1.2545
 

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