Cable broke through the peak of today's 1.9879-1.9908 Asian session range in early European trade, as the continent absorbed the content of yesterday's speech from Mervyn King. The BoE Governor stated that rapid growth in the supply of money and credit in the UK economy may be warning signal of inflationary risks (Times). King has also pledged to give financial markets a better idea of the circumstances that are likely to trigger rate changes (FT).
1.9939 was the European morning high. Touted offers at 1.9950 represent an appreciation obstacle above. Upper resistance levels: 1.9970, 1.9990 and 2.0000.
EUR/GBP has elicited support ahead of 0.6825 since its fall from an early Europe intra-day high of 0.6837. Some of that support might be option-related, re: talk of a very large 0.6825 option strike in the market. There are 0.6825, 0.6815 and 0.6800 option expiries at today's 10am Eastern NY cut (14:00GMT).
April's US ISM non-manufacturing index is due at 14:00GMT. Forecast: 53.2. US weekly jobless claims precede at 12:30GMT. Forecast: 325k. UK local election polling stations close at 21:00GMT (BBC website).
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