By FX Empire.com
The GBP/USD started the week on Monday affected by the sentiment and market jitters as the focus continued on debt laden nations in the euro area and the worsening outlook for the monetary union and accordingly global financial stability and growth. The jitters supported risk aversion and powered the dollar for gains versus sterling.
Investors are worried over the outlook for the euro area and the deepening crisis that is only intensifying market strain and leading the global economy to risk falling in another recession. The UK economy will surely be affected further by the debt crisis and the slowing of global economic conditions and the BoE already started to take counter measures and last month expanded the APF last month.
This week the BoE is expected to keep their monetary policy unchanged after to give the APF time to show effect, especially as inflation remains stubbornly high even as the bank expects that it will undershoot the target over the medium term.
We have little data on Tuesday and the focus will remain on the euro area with the developments in Greece and Italy and also the EU finance ministers meeting that will increase the volatility further.
At 09:30 GMT, the British economy will release industrial and manufacturing production for the month of Sep., where the U.S. has no releases.
Originally posted here
