Without any major economic data released from the U.K. on Thursday, the Sterling actually found itself with better footing. The GBP was able to firm like its counterpart the EUR. As to the reason why this happened, a couple of thoughts can be considered. One of the possibilities is that investors feel that the Sterling was oversold during the recent selloff which it experienced. Or two, it could very well be that what happened yesterday is short covering by investors who are cashing in on profits. The Sterling no matter the above scenarios, remains uncomfortably linked with the EUR regarding the Sovereign Debt concerns from the European continent rightly or wrongly. Today Public Sector Net Borrowing data will be published along with Preliminary Mortgage Approvals. The Mortgage numbers are expecting to see improvement and investors will follow its outcome. The GBP is likely to mirror the EUR in many respects today and traders should expect a fast paced market.
Written by bforex.com