The pair closed Friday at $1.7160 after rate had retested recent highs at $1.7180 (68-mth high), before it retreated to $1.7132. The rate then recovered to $1.7167 through a thin US holiday European afternoon before it settled between $1.7155/60 into the close. Rate picked up fresh demand into early Asia which took rate up to overnight highs of $1.7172 before general dollar demand emerged to counter. This dollar demand seen on UST yield rise, with some pointing to GS revising their Fed hike call to Q3 2015 from Q1 2016. Cable was pressed back to $1.7136 before it settled around $1.7140 ahead of the European open. Euro-sterling consolidated recent easing, with trade through theovernight session contained by stg0.7920-0.79265. A light domestic calendar today with attention on Tuesday’s IP/Mfg release and Thursday’s BOE MPC decision (though no change in rates/QE expected, more interest will be seen for the Minutes of this meeting). Following the US holiday Friday markets expected to remain subdued until the US markets show their influence on their return. Cable offers remain in place into $1.7180, a break to open a move toward $1.7200. Support $1.7136/26 (50%-61.8% $1.7092-1.7180) ahead of $1.7113 (76.4%).
