(eToro Blog) The Pound Sterling is coming under some sell pressure in market trading today following the earlier release of the Bank of England's meeting minutes as well as various U.K. statistical data.

Clearly the one having the greatest impact on the Pound Sterling today was the Monetary Policy Committee's release of the official minutes of their most recent meeting. Following that release, market expectations of an interest rate increase were essentially dashed.

The outgoing MPC member and chief rate hawk Andrew Sentence among the minority, by a vote of 6 to 3, the MPC decided to keep interest rates at the current 0.5%. Mr. Sentence's heir apparent, Ben Broadbent, is believed unlikely to stray far from the majority position.

Mixed data on the U.K. labor situation also weighed on the currency; data showed that claims for job seeker allowances rose to 1.47 million in April, an increase of 12,400 new claimants and the largest such increase in 15 months. This follows March's revised rise of 6,400 claimants. Unemployment fell to 2.46 million for the three month period through March ending, a decline of 36,000 jobs while the unemployment rate dropped to 7.7%, a decline of 0.1% for the quarter. Analysts note that markets are likely to remain wary over the labor situation there, given that the austerity measures recently implemented by the government aren't helping to improve the unemployment situation to the degree expected.

And last, but not least, the U.K.'s National Statistics Office yesterday reported that inflation, as evidenced by the Consumer Price Index, rose well above the Bank of England's target to 4.5% last month from 4% in March, higher than the 4.1% rise that a consensus of economists had predicted. This was the highest level reported in 2½ years, but analysts attribute the increase as likely being caused by the late Easter holiday.

Although the Sterling suffered strong downward pressure following subdued economic data which emphasis the fact that the UK economy is not on strong footing and not able to handle higher rates. However investors continue to see Sterling long term price as cheap with the royal currency way lower that is 2008 peak again the Dollar and the Yen. Hence upside potential seems attractive enough for investors looking for a long term trajectory. There is a broad consensus UK inflation is way above healthy levels but economic weakness blocks the BoE from curbing that phenomenon. Any surprise in UK growth in the following weeks could quickly cause the big players to shift there investment to the royal currency with growing volumes. Long term the Sterling looks cheap and when economic data will begin to support a high Sterling will become a consensus.

Against the U.S. Dollar, the Pound earlier fell to a 1-month low; on the eToro trading floor, traders of GBP/USD, recently at 1.6161, are bullish in favor of the Pound, with buying favored by 7 buyers to 2 sellers. Against the safe haven Yen, the Pound Sterling was recently lower at 131.36, and sentiment among eToro's traders of GBP/JPY is bullish in favor of buying by a ratio of 9 buyers to 3 sellers.

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