The pair closed in NY Monday at $1.6360 as rate continued to recover off Friday’s closing lows around $1.6285, touching an eventual high in the NY session of $1.6369 before drifting slightly off into the close. Rate touched an early low of $1.6356 in opening Asian trade before the recovery trend resumed to lift rate on to $1.6391 ahead of the European open. Euro-sterling also reflected this correction in sterling as the cross eased away from the stg0.7880 area (Friday close), touching a low of stg0.7845 in NY Monday (closed at stg0.7853), with Asia extending this move to stg0.7842 and was holding heavy ahead of the European open. A light domestic data calendar with attention this morning to be on the release of flash EZ PMI’s (beginning at 0700GMT), followed in the afternoon by US mfg PMI at 1345GMT, and Richmond Fed at 1400GMT. Sterling remains favoured, especially versus the euro on monetary policy divergence,though against the dollar gains expected to meet headwinds. Cable resistance seen from $1.6390 through to $1.6405, a break to open a move toward $1.6430/35. Support seen at the Asia low of $1.6356 ahead of stronger interest between $1.6330/20.
