The pound is under pressure after the release of data on the British economy

On Tuesday, the pound sterling is declining after the release of economic statistics indicating a reduction in activity in the UK economy and the likelihood of a recession in 2023.

The current quote of the GBP/USD currency pair is 1.2293. The British currency declined after the preliminary composite Purchasing Managers' Index (Composite PMI) showed that in January business activity in the private sector declined at the fastest pace in two years. Analysts explain such dynamics by raising the Bank of England rate, strikes and weak consumer demand.

Simon Harvey, chief currency analyst at Monex Europe, noted that at best this year the British economy will stagnate. But if we assess the situation realistically, we should expect a recession.

Nevertheless, it is expected that at the meeting on February 2, the Bank of England will raise interest rates for the tenth time in a row. Currently, the rate level is 3.5%, whereas at the beginning of last year the rate was only 0.1% per annum.