July 31, 2012
Down she goes! The pound traded lower against most of its counterparts yesterday following the release of worse than expected data from the U.K. GBP/USD dipped to an intraday low of 1.5673 before ending the day 17 pips below its opening price at 1.5711. Meanwhile, GBP/JPY finished with a 60-pip loss for the day at 122.84.
There were a few economic reports from the U.K. yesterday. Sadly for the pound bulls, all of them fell short of expectations.
The BOE reported that net lending to individuals only amounted to 300 million GBP in July when analysts were expecting it to be around 800 million GBP for the month. On top of that, the CBI's report on consumer spending for the current month also came in lower than forecasts. The realized sales index printed at 11 versus the 17 consensus.
Lastly, the GfK consumer confidence index showed a more dire level of optimism among British consumers. The figure for July was at -29 and disappointed the market's forecast at -28.
Our forex calendar doesn't list any top-tier data from the U.K today. Hmmm, I guess everyone o'er there is busy watching the Olympics. If you're looking to trade the pound, make sure you keep tabs on market sentiment as the market's mood will probably continue to dictate the currency's price action. Remember that risk appetite is usually good for higher-yielding currencies (including the pound!) while risk aversion usually sends them lower on the charts. Good luck!
Last edited by PipDiddy; 07-30-2012 at 10:12 PM.
"The only cable I watch is the pound baby."