Purchasing managers’ indices in the UK were generally better than expected and pointed to growth in January. The chances of an official recession are now lower. Nevertheless, even if Britain escapes another quarter of contraction, the QE train seems unstoppable. The numbers The most important sector is services, which was the last to be released. The PMI for this sector jumped from 54 to 56 points. This means accelerated growth and it looks even better when compared to the early expectations, which stood on a drop from 54 to 53.5 points. Manufacturing was lagging behind and was in contraction zone, under 50 points. It also surprised. Not only did it climb back above 50, but it did with a leap to 52.1 points, higher than 50.1 that was predicted. Only the construction sector fell short of expectations, sliding from 53.2 to 51.4 points. This is still above 50 and reflects a smaller sector. QE Train Out of the Station Despite all this improvement, the Bank of England will likely embark on another round of Quantitative Easing, or in its own language: expand the Asset Purchase Facility program. It currently stands on 275 billion pounds, and an additional 75 billion will likely be added in the upcoming meeting. Why? Current expansion expired: The recent expansion of 75 billion, introduced in October, already ran its course and expired at the end of January. This is the perfect timing for expansion. Unemployment is still high: this weighs on the economy. With the government busy with austerity, the central bank is urged to “do something”. The same applies for the US. Hints: The most dovish member of the Monetary Policy Committee, Adam Posen, certainly supports more expansion. That’s not surprising. What is more convincing, is that Posen hinted that this view is the majority within the MPC. The next rate decision will take place on February 9th. Another round of QE could certainly cut the recent impressive rally of GBP/USD. For more on the pound, see the GBP/USD Forecast. Yohay Elam Yohay Elam Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts. Yohay's Google Profile View All Post By Yohay Elam Forex News Today: Daily Trading News share Read Next EUR/USD Feb 3. – Edging Higher Before the NFP Yohay Elam 11 years Purchasing managers' indices in the UK were generally better than expected and pointed to growth in January. The chances of an official recession are now lower. Nevertheless, even if Britain escapes another quarter of contraction, the QE train seems unstoppable. The numbers The most important sector is services, which was the last to be released. The PMI for this sector jumped from 54 to 56 points. This means accelerated growth and it looks even better when compared to the early expectations, which stood on a drop from 54 to 53.5 points. Manufacturing was lagging behind and was in contraction zone,… Regulated Forex Brokers All Brokers Sponsored Brokers Broker Benefits Min Deposit Score Visit Broker 1 $100T&Cs Apply 0% Commission and No stamp DutyRegulated by US,UK & International StockCopy Successfull Traders 9.8 Visit Site FreeBets Reviews$100Your capital is at risk. 2 T&Cs Apply 9.8 Visit Site FreeBets Reviews$100Your capital is at risk. 3 Recommended Broker $100T&Cs Apply No deposit or withdrawal feesTrade major forex pairs such as EUR/USD with leverage up to 30:1 and tight spreads of 0.9 pips Low $100 minimum deposit to open a trading account 9 Visit Site FreeBets ReviewsYour capital is at risk. 4 T&Cs Apply Visit Site FreeBets ReviewsYour capital is at risk. 5 Recommended Broker $0T&Cs Apply Trade gold, silver, and platinum directly against major currenciesUp to 1:500 leverage for forex trading24/5 customer service by phone and email 9 Visit Site FreeBets ReviewsYour capital is at risk.