Cable has reclaimed a 1.92 handle since Reuters reported that the IMF has revised up its 2007 UK GDP forecast to 2.9%, from 2.75% previously. The IMF additionally opines that the sterling exchange rate "may be slightly overvalued, but not enough to be a concern", and says the UK may need further monetary policy tightening.
GBP/USD tripped stops sub-1.9200 en route to a new 15-week low of 1.9185, prior to Reuters reporting the IMF news. Further stops are touted below 1.9180. 1.9220 and 1.9260 (Jan 8 low) are sterling resistance levels. Funds and CTA's have been seen selling into rallies.
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