Yesterday’s session saw sterling fight back following 2 days of selling in the wake of the BoE’s monetary policy announcement. The central bank flummoxed investors with hawkish rhetoric leading up to the decision only to produce a somewhat dovish outcome. This created an instant requirement for the wrong-footed participants to reposition which, in turn, saw the pound sold off hard.
Sterling began to rise once European markets got underway yesterday, GBPUSD made easy work of the $1.35 handle while GBPEUR pushed back above the €1.17 mark. While one day of gains does not indicate the tide has changed, it does offer bulls some hope that the bout of selling since the announcement may be subsiding.
Today’s economic calendar sees German trade and ZEW figures. US producer price index and small business index readings too. There will also be speeches from key central bankers Lagarde and Powell of the ECB and Fed.
Written by Viv Savani. 6:48am, November 9th 2021
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