Cable closed in NY Friday at $1.5835, marked lows into early Asia Monday at $1.5834 before pushing higher, the rate tracking EUR/USD early move up with ‘risk on’ trade seen prompted by an expected positive outcome from today’s Eurogroup meeting, concerning Greek debt aid, as well as the weekend cut in China’s RRR by 50bps. GBP edged to an early high of $1.5880, settling above $1.5860 through the session. MPC member Posen speech on Friday was seen tending to suggest that he was content with current policy settings, though it was also noted that he wouldn’t be drawn on whether another round of QE will be considered. Sterling continued to enjoy underlying buoyancy, recovering as it has off last week’s lows of $1.5644 (Feb14) and making a show above its 76.4% retracement level at $1.5862 (from the $1.5929 Feb8 high). Rate was pulled back to $1.5846 in early Europe on EUR/USD slippage, with recovery faltering around $1.5860. Late morning corrective pullback in EUR/USD saw cable retest earlier lows, extending pullback to $1.5840.
EasyForexNews Research Team