The pound remains true to its reputation: the British currency still ignores the most important macroeconomic reports, but at the same time it reacts sharply to the news flow related to the Brexit prospects. Today's GBP/USD price dynamics once again reminded traders of the pair's priorities, when amid extremely weak data on the growth of the British economy and industrial production, the currency surged by 100 points at once. Such price impulses are very useful for traders of the pound-dollar pair. After all, they indicate that even a multi-day downward trend is not a guarantee of its resumption - only one positive news regarding the prospects of the "divorce proceedings" is capable of turning the pair 180 degrees.

Here it is worth noting that today's news occasion is very indirectly related to Brexit. Today it became known that the Brexit Party of the odious Nigel Faraj will not nominate candidates in those 317 polling stations where members of the Conservative Party won the year before last. At the same time, he assured that his party will actively fight with the main opponents of Boris Johnson - the Labour Party. According to Faraj, he will try to take away "as many mandates from them as he can."

It is worth noting here that Faraj is "the most radical version of Johnson." They both play on the same electoral field, only the Brexit Party advocates leaving the EU without any agreement with the EU, that is, the "hard" scenario of the divorce proceedings. In fact, no one more or less noticeable political force is in favor of this option: both Labour and Conservatives insist on agreements with the EU on particular exit conditions. Therefore, just a few months after the creation of the Brexit Party (it was created at the beginning of 2019), Faraj was able to find his followers, including those disappointed in Theresa May and Boris Johnson.

According to recent polls, almost 14% were ready to vote for this political force. In other words, playing on the field of the current prime minister, Nigel can "bite off" an impressive piece of the electoral pie, jeopardizing the formation of their own majority by Conservatives. Earlier, the leader of Brexit promised to nominate more than 600 candidates across the country: Johnson would have to fight not only with the opposition, but also with yesterday's colleagues.

Now supporters of Brexit (both ordered and disordered) are in the hands of Conservatives. Johnson gets a real chance to form an absolute majority, which will allow him to make a deal with the EU through the millstone of the House of Commons without any problems. In response to Faraj's statement, the pound jumped by 100 points against the dollar, but at the same time is in no hurry to return to the 29th figure. There are several reasons for this.

Firstly, there is still a whole month ahead of the elections, during which both the Labour Party and the rest of the parties will actively campaign, which means that the ratings may change significantly by the end. Secondly, due to the specifics of the UK electoral system, one cannot identify the party rating with the estimated number of seats in the House of Commons. For example, four years ago, during the next Parliament elections, Conservatives had almost 37% of the vote, and they were able to form a mono-majority (330 seats). In 2017, when Theresa May initiated an early election, the Tories lost their majority, receiving only 317 mandates, although they received 42.5% in the elections.

Thirdly, GBP/USD traders were very disappointed with the rate of GDP growth in Britain today. Although macroeconomic reports played a secondary role in the context of political events, today's figures played the role of a kind of "anchor" for the pair.

In the second quarter, this indicator reached the level of 0.3% (quarterly). On the one hand, it left the negative area, and on the other hand, it failed to reach the forecast values. In annual terms, the indicator continued its downward trend, dropping to 1% (with a forecast of 1.1%). For comparison: in the first quarter of 2019, GDP was at the level of 1.8% YOY.

In addition to the GDP indicator, the volume of industrial production in Britain also disappointed. In both monthly and annual terms, the indicator remained in the negative area (-0.3% and -1.4%, respectively). But the production volume of the processing industry collapsed to -1.4% (on an annualized basis). And although experts expected a downward trend in the above indicators, real numbers were worse than pessimistic forecasts. The rest of today's releases also did not impress GBP/USD traders.

It is worth recalling that the results of the last meeting of the Bank of England were dovish in nature. Mark Carney confirmed that the central bank's next likely move would be a reduction in interest rates, as the Bank of England's updated economic forecasts were revised negatively. He also expressed concern that weak investment is damaging industrial production and rising inflation. The data published today only confirmed the validity of the position of the members of the English regulator.

Thus, the current growth of the British currency is unstable: after the first emotions of the market disappear, the pair will return to the bottom of the 28th figure, waiting for the next piece of news regarding the prospects of early elections/Brexit. Macroeconomic reports against this background will play a secondary role.