Pop goes the GBP balloon after poor data
You can kiss goodbye to 1.5400 right now as the data gives pound traders a wake up call
GBPUSD is down at 1.5351 as I type following the data and we get another stark reminder that the UK economy has hit a brick wall
You're probably sick of me saying it by now but the weak global picture is holding the UK back and the same is going to happen to the US and Europe
The thing is that if the central banks do hold off on raising rates they're going to be in a very difficult position to counter this weakness. You can forget QE because its effect is mainly domestic, which by and large doesn't need any help. QE won't boost exports. Weaker currencies won't boost exports. It doesn't matter what level the currency is at if no one is buying from you. The euro is weaker and they can't even increase exports to any great degree
For now the data is going to take some hawkish feeling out of the MPC meeting tomorrow, and with the worse services numbers number the last two months, Q3 GDP is already on the back foot
While my view on CB's raising rates remains the same, I'm becoming more worried about the state of UK data now
