Closed in NY Friday at $1.5114 after recovering off a pullback low of $1.5076, seen after the rate had earlier seen highs of $1.5177. Risk was under pressure into the Asia open as the market marked the euro lower following the Troika’s proposal to penalise Cypriot bank depositors, with the implications should this event not be a contained event, cable was marked down to $1.5080 at the open, extended lows to $1.5061 before it spiked back up to $1.5160 as euro-sterling, which had gapped at its open from stg0.8650 to stg0.8584, extended the move to stg0.8533. Demand placed between stg0.8535/30 provided a base in the cross which in turn allowed cable to track euro-dollar moves, the rate easing to $1.5072 before settling around $1.5100 into the European open. The cross edged away from its base to stg0.8562 before it settled around stg0.8540. Release of Rightmove house price data overnight, showing a move to 1.2% from 1.1% in the annual rate was basically ignored due to the Cyprus events. The domestic data calendar is light with moves to come from external factors. Sterling may attract some risk off inflows, despite further QE threat, but could be viewed as a safe haven for depositors.
EasyForexNews Research Team