The pair closed in NY Wednesday at $1.5268 after recovering off an extended low of $1.5250. The move down was seen on general dollar demand, though cable also played catch up on euro-dollar’s slippage as euro-sterling recovered off an early session low of stg0.7237, prompted by release of slightly weaker than forecast UK services PMI data. Cable’s recovery into the NY close continued into Asia, the rate lifting to $1.5269 before momentum faded and rate turned lower, drifting off to lows of $1.5243 ahead of the European open. Moves through Asia were generally dictated by euro-dollar moves as euro-sterling consolidated within a range of stg0.7250-0.72615. Euro-sterling retains a heavy tone, with attention today on the ECB meeting (no change expected in rates but market will await details of ECB QE and Staff projections). Halifax house price data at 0800GMT provides early focus ahead of the BOE MPC announcement at 1200GMT (no change expected in rates/QE). Euro-dollar continues in focus, following yesterday’s break below $1.1098 into fresh 2015 low territory, with rate retaining an underlying bearish tone which will weigh on cable, though euro-sterling could divert some of this pressure.
