GBP/USD traded in the upper half of the days range during the US session, supported by rising UK house price data and M&A-driven demand for the pound. These helped push EUR/GBP lower early on the day and pumped GBP/USD toward 1.8650 briefly. Short-covering kicked in as stops were tripped in several waves from 1.8590, 1.8600, 1.8625, and 1.8640 before prices eased back to 1.8595 intraday. 1.8585 is support now on dips, the 50% retracement of the bounce from 1.8525.
UK inflation data is set for release tomorrow. A dip to 2.4% is expected, but given the slide in energy prices last months, we'd wager a weaker figure will be seen. Most will look past the September data as a one-off, should it dip sharply. MPC members have already predicted a temporary downside blip in the September data. ZEW may be more important as another weak figure could pressure the EUR and drag cable down with it. Last month saw a -22 reading. -20 is expected this month. Some 1.8500 barriers rolled off today, but more are eyed on the books, dealers report, suggesting more protection on dips.
No comments:
Post a Comment