Back
19 Mar 2013
Forex: GBP/USD extends its decline below 1.5100
FXstreet.com (Barcelona) - Pessimism has continued to overwhelm sterling sentiment this morning, ahead of the UK inflation figures and the BoE Letter of Inflation due later.
“Generic rate spreads still remain a key driver and there has been a gradual fall in generic UK/US 5year rate spread since late February. This may reflect the markets starting to romance the idea of the Fed tapering off QE as the US economy recovers. If we see US yields start to reflect this view more forcibly then the move lower in the generic UK/US 5y rate spread should point to further downside risks for the pair”, assessed Paul Robson, FX Trading Strategist at RBS.
At the moment, the pair is retreating 0.17% at 1.5081 with the next support at 1.5072 (low Mar.18) ahead of 1.5011 (MA10d) and then 1.4965 (low Mar.7).
On the upside, a breakout of 1.5160 (high Mar.18) would clear the way to 1.5177 (high Mar.15) and then 1.5200 (high Mar.5).
“Generic rate spreads still remain a key driver and there has been a gradual fall in generic UK/US 5year rate spread since late February. This may reflect the markets starting to romance the idea of the Fed tapering off QE as the US economy recovers. If we see US yields start to reflect this view more forcibly then the move lower in the generic UK/US 5y rate spread should point to further downside risks for the pair”, assessed Paul Robson, FX Trading Strategist at RBS.
At the moment, the pair is retreating 0.17% at 1.5081 with the next support at 1.5072 (low Mar.18) ahead of 1.5011 (MA10d) and then 1.4965 (low Mar.7).
On the upside, a breakout of 1.5160 (high Mar.18) would clear the way to 1.5177 (high Mar.15) and then 1.5200 (high Mar.5).