Rates as of 0500 GMT
After several days of decline, the beleaguered pound bounced back yesterday. It was the bestperforming currency of the day. Was this related to the reopening of the pubs? Traders in a better mood, more favorably inclined toward the government and hence the currency? Or perhaps optimism ahead of this mornings slew of UK indicators, the monthly UK shortterm indicator day? which in the event turned out to be not so great GDP rising from the previous month less than expected, services far below expectations, the trade deficit gaping wideronly industrial and manufacturing production beating estimates
I think the pounds recent decline wasnt fundamentally based and so I wont look for any fundamental reason for its rebound, either. Looking at the charts, it looks to me like there were attempts to push it lower under 1.37 or perhaps 1.37 set off some stops, but the attack faded each time and so perhaps they just gave up.
Or perhaps it was the inability of EURGBP to break through 0.87
I wonder if technical traders are just taking a break or have given up. My guess is that theyre just taking a break and will resume the attack eventually, but as I said thats no more than my guess. The reason I feel that way is probably that Im biased against the pound. I think Brexit is going to continue to weigh on the UK economy, as shown by todays disastrous trade data.
Furthermore, weve now got open rebellion in Northern Ireland, which increases the…