Tomorrow and on Thursday, traders will learn about decisions that will be taken by the Federal Reserve, the European Central Bank, and the Bank of England. Today, traders’ sentiment could be affected by speculations about changes in the monetary policies of the main central banks and important macroeconomic reports. In our video review, we are going to focus on these reports and traders’ reaction to them. Data on the UK lending market turned out to be well below the forecast. Thus, consumer credit dropped to 0.5 billion pounds, while economists had expected 1 billion 300 million pounds. In the previous month, consumer credit totaled 1.5 billion pounds. The number of mortgage approvals slumped to 35,600 compared to 46,200 in the previous month. Economists had foreseen a smaller decline. According to the forecast, the number of approvals should have dropped to 45,000. The real estate market is of vital importance for the UK as it accounts for about 20% of the country’s economy. That is why such a slowdown in mortgage lending points to a slump in one of the key sectors of the UK economy. Against the backdrop, the pound sterling continued falling and approached the lower limit of the range, where it has been trading for a week already. The euro also dropped to the lower limit of its range. However, the currency stopped falling just after the publication of the eurozone preliminary GDP data for the fourth quarter. The fact is that the data significantly exceeded the forecast. The economic growth rate slackened to 1.9% from 2.3% instead of dropping to 1.6%. Notably, the recent GDP data from the US was worse than expected. Judging by the preliminary estimates, in 2022, the European economy expanded faster than the American one. It is highly possible that the data on the eurozone GDP will boost the euro and the pound sterling to the upper limits of their ranges. On the trading chart, we see that the euro/dollar pair slid below 1.0835 for the first time since the current channel was formed. This may point to a shift in the trading sentiment in favor of sellers. As a result, the pair decreased to the support level of 1.0800. The next downward impulse will occur if the price settles below 1.0800. Otherwise, the pair will rebound. Although the pound sterling opened a new trading week with a decline against the US dollar, the quote is still hovering within the range of 1.2300/1.2440. The British pound touched the lower limit of the range amid a downward cycle. The currency’s further movement will depend on its behavior near 1.2300. At the moment, traders choose either a rebound or breakout strategy.

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00:00 INTRO
00:32 UK
00:54 UK MORTGAGE APPROVALS
01:34 QUOTES
02:04 EUROZONE GDP GROWTH RATE
02:39 EUR | USD
03:07 GBP | USD