FXstreet.com

Daily FX Commentary

This report has been deactivated

1

1

Daily FX Commentary

Mon, Mar 16 2009, 13:57 GMT

Investica Ltd


Sterling advance set to stall

In its quarterly report, the Bank of England warned that many households could face a debt and deflation trap. The comments will reinforce expectations that the central bank will push ahead with an aggressive quantitative easing policy.

The international perspective will also remain very important for the UK currency. There will be increased speculation that the US Federal Reserve will move towards buying government bonds and there will be increased pressure for the ECB to take more aggressive and non-standard policy action.

The Bank of England quantitative easing will still be an important risk threat to Sterling, but any additional moves by  other G7 banks would certainly limit the UK currency risks.

Sterling found support below the 1.39 level against the dollar on Monday and then rallied sharply to highs above 1.42 while it also made ground against the Euro. Near-term moves will remain correlated strongly with degrees of risk appetite

The latest UK unemployment data will be watched closely this week.  If the labour market does not appear to be deteriorating any faster than in other major economies then Sterling may continue to gain some support. In contrast, any monthly increase above 100,000 would tend to undermine the currency.

Published on  Mon, Mar 16 2009, 13:59 GMT


Archive

Investica Ltd http://www.investica.co.uk | tim.clayton@investica.co.uk

Legal disclaimer and risk disclosure

Investica's market analysis is not investment advice and must not be taken as recommending particular market positions. Investica can take no responsibility for any actions taken by investors.


Interested in forex trading? forex brokerage firms!


MG Financial Group
Contact the broker/FDM
Open a demo account
ACM Advanced Currency Markets SA
Contact the broker/FDM
Open a demo account
Deutsche Bank
Contact the broker/FDM
Open a demo account		City Credit Capital (UK) Limited
Contact the broker/FDM
Open a demo account		Alpari (US), LLC
Contact the broker/FDM
Open a demo account

GET CASH BACK FOR YOUR TRADES!   Learn more about the Pip Rebate Program

Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer.

Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.

Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. FXstreet.com has not verified the accuracy or basis-in-fact of any claim or statement made by any independent author: errors and Omissions may occur.

Any opinions, news, research, analyses, prices or other information contained on this website, by FXstreet.com, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. FXstreet.com will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.

©2009 "FXstreet.com. The Forex Market" All Rights Reserved.