Neither stress test results nor unemployment figures stopped the bulls last week from driving the major indices higher. Forex traders also partied on certain currencies, as counterparts rallied against the U.S Dollar.
Trading was capped most of last week, as traders were preparing for a volatile Thursday and Friday. The BOE was the first to approach the stage, during Thursday’s session, releasing its interest rate decision for the month of May. Governor Brown and his administration decided to keep a firm 0.5% this time round, but mentioned that they might decide to buy £50 billion worth of assets, to help further stabilize the economic situation. The statement that followed the decision showed a fragile situation as comments showed that even though GDP had decreased sharply during the first quarter of 2009, the housing sector showed minor signs of an improving situation. Even though the central bank decided to refrain from taking any monetary action, the GBP/USD failed to maintain its strength as further comments showed that the Bank is quite uncertain as to when the U.K will make a full recovery.
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