FX.co ★ Cautious Mark Carney

Mark Carney is highly concerned about the Brexit and its possible consequences, making it clear that the Bank of England will not raise the refinancing rate for this year. Although the negotiation has been processed for a long time, considering that the inflation accelerated from 2.9% to 3.0%. With such inflation, sustaining a bet at 0.25% is not strange at all, but considered as borders on insanity.

Furthermore, issues in Europe are not going too smooth as well. The Inflation stabilized at 1.5%, and the maximum that can be expected is the ECB will complete the quantitative easing program in December. There is no question of raising the refinancing rate in the foreseeable future.

In general, the dollar could rise in price and become stronger, but with the support from the industrial production data, that showed growth from 1.2% to 1.6% and still regarded worse than forecasts.

There is a reason for a small rebound for today, since Europe provided no data, while the UK labor market data are already published. The unemployment rate would likely remain unchanged, while the number of applications for unemployment benefits may increase by 1.0 thousand. Also, the wage growth rates seem to remain steady which is not good, since they are lower than inflation. Nevertheless, the overall state of the labor market is relatively good. But in the United States, a decrease in the number of issued construction permits from 1,300,000 to 1,245,000 is projected. In contrast with the background of a much slower growth in the industry, a decrease in the number of permits indicates a high probability of slowing the growth of the industry.

The euro-dollar pair has positive chances to increase to 1.1800.

The pound-dollar pair will consolidate at 1.3215.