UK economy picking up speed- But Sterling weakens...

It is with no doubt that Britain's economy is gaining momentum, but it seems BoE's policy makers held very different views when it came down to the inflation outlook and how long this momentum will really last;

The minutes showed that the economy grew by 1 percent in the first three months of this year from the fourth quarter of 2013, up slightly from a previous growth forecast of 0.9 percent, however policy makers were expecting a slight slow down during the second quarter.

The reason we are seeing so much uncertainty in all GBP pairings at the moment is because the MPC are still unsure on how much scope Britain's economy has to grow without generating inflation.

"British inflation dropped to 1.6 percent in March from February's 1.7 percent - the lowest level since October 2009." - Reuters

Britain's unemployment rate unexpectedly dropped in the three months to February below the 7 percent level originally set by the Bank for considering an increase in interest rates, and wages caught up with inflation for the first time in nearly four years. The reason why the market has been reacting negatively to this is due to the fact the BoE hasn't considered any interest rate hikes as of yet.

It is safe to say that the economy is growing at a steady pace, better than we have seen for a few years, however for people looking for strong GBP rates, the outlook is that until we see a rise in interest rates in the UK, we won't see massive spikes in the market.

However Friday will be a key day to watch how the retail sales data comes out in the UK, as it is expected strong, we could well see the spike that buyers are waiting for!

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