The pair closed in NY Monday at $1.6084 after rate had tracked euro-dollar’s stronger rally from earlier lows of $1.5943 to an eventual high of $1.6099. Move was driven as the dollar pared back gains seen on the back of last Friday’s NFP react, with move aided in later NY by the release of the Fed’s Labor Conditions Index. CitiFX Wire suggested that the index level was a bit lower than expectations, leaving some to argue that results influenced further USD selling. With cable lagging euro-dollar’s move it allowed euro-sterling to eventually move through resistance at stg0.7860 to a high of stg0.7874(Jul23low), with rate consolidating this move between stg0.78625-0.78705 through Asia. Cable touched an early high in Asia at $1.6086 before general dollar demand emerged to press rate back to $1.6027 where it met willing buyers. Rate edged back to $1.6060, holding between $1.6050/60 ahead of Europe. Euro-sterling remained buoyed above its broken resistance of stg0.7860. UK IP/Mfg at 0830GMT seen key on the day as UK growth keenly watched to determine the timing for a BOE rate hike. Median expectations are flat for IP m/m, a negative release expected to dent sterling further.
