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20 Nov 2013
Flash: GBP strength from where? - BBH
FXstreet.com (London) - The currency research team at BBH said the two main price features today are the strength of sterling and the weakness of the Antipodean currencies.
Key Quotes:
“It is difficult to link sterling's gains to the MPC minutes, which appear to have largely been preempted by the Quarterly Inflation Report. The BOE is more upbeat on the economy than it was a few months ago”.
“It largely shrugged off the rise in inflation expectations and notes that such expectations have not filtered into wage increases. This is arguably a mistake that it sees this as a good thing”.
“Declines in real income are not consistent with a sustained economic recovery. It appears the bid for sterling demand is against the euro, which is staging a potential reversal after moving higher the last couple of days. A break of GBP0.8360 is needed to open up the downside”.
“Against the dollar, the double top from October was set near $1.6260 and appears to be the target”.
Key Quotes:
“It is difficult to link sterling's gains to the MPC minutes, which appear to have largely been preempted by the Quarterly Inflation Report. The BOE is more upbeat on the economy than it was a few months ago”.
“It largely shrugged off the rise in inflation expectations and notes that such expectations have not filtered into wage increases. This is arguably a mistake that it sees this as a good thing”.
“Declines in real income are not consistent with a sustained economic recovery. It appears the bid for sterling demand is against the euro, which is staging a potential reversal after moving higher the last couple of days. A break of GBP0.8360 is needed to open up the downside”.
“Against the dollar, the double top from October was set near $1.6260 and appears to be the target”.