The pair closed in NY Thursday at $1.6987 after recovering off an intraday low of $1.6967. Sterling had lost ground during the day following the release of weaker than forecast headline UK retail sales data, note that BOE Carney has reiterated recently that any rate hike going forward will be data dependent. Focus today will turn to the first reading of UK Q2 GDP data at 0830GMT, median 0.8% Q/Q, 3.10% y/y. Ahead of this we have Germany Ifo at 0800GMT with market waiting to see if Thursday’s strong flash PMI release is reflected in this data. Euro-sterling played its part in pressuring sterlinglower Thursday, the strong EZ PMI’s driving the cross to highs of stg0.7940, off earlier lows of stg0.7889. Rate closed the day at stg0.7925, with Asia overnight consolidating within a range of stg0.79245/0.7927. Cable extended its recovery to $1.6995 but faltered at the key $1.6996 level. This level was highlighted Thursday, the May6 high, with tech traders suggesting a close below would add bearish weight on cable. Rate eased to $1.6986 but was back pressuring toward the $1.6995 high ahead of Europe. Cable offers $1.6995/1.7000, a break to open a move toward broken support at $1.7037. Support $1.6967 ahead of $1.6955/50.
