Is the UK recovery real?

The U.K. economy is finally leaving behind the mire of the financial crisis.

House prices hit a new record in May eclipsing the pre-crisis peak in October 2007.

Unemployment has fallen to 6.8%, consumer confidence is at a record high and the economy is now forecast to grow by more than 3% this year and next.

But, as Mark Carney, governor of the Bank of England, comes to the end of his first year, is this recovery for real? Is Mr. Carney in danger of reacting too slowly on interest rate policy and creating an unbalanced recovery? Could an overheating housing market put the U.K.’s long-term growth at risk?

These are all questions being asked by everyone in the UK at the moment; the fact is, we will have to wait and see what happens.

On Monday we have a pretty quiet day on the markets; with the main data release coming from Europe at 10am (Eurozone CPI) which is the indicator for inflation levels in Europe. Of course we know that inflation was very low previously, which is why interest rates were dropped to help consumers spend more, but analysts are unsure if there will be an instant positive response to this.

If you have a FX transaction coming up then please don't hesitate to contact me for analysis.