The pair closed Thursday in NY at $1.5718 after rate had seen a stop driven drive up to $1.5737 as strong demand emerged at the 4pm WMR fix, the rate then dropping back to $1.5670 before the dollar came under general pressure, as market reacted to a WSJ Hilsenrath article warning that when the Fed does move to tapering it will not be implying any intent to hike short-term rates, which pushed rate higher into the close. These recovery gains struggled into early Asian trade as profit take sales emerged to press rate back toward $1.5700. A recovery to $1.5718 proved short lived as rate turned lower again, drifting off to $1.5695 before fresh demand emerged ahead of the European open to edge it back to $1.5709. Moves through Asia basically tracked euro-dollar as the cross was held within a tight stg0.85005-0.85085 range. UK construction output data at 0830GMT provides the morning’s domestic interest. Rate closed Thursday’s session above its 200-dma ($1.5701, today $1.5700) which if holds at today’s close will further support the rate’s positive outlook, though traders continue to warn that move could be close to a top.
