The Sterling slipped further against the USD on Tuesday. The DCLG HPI proved a bit disappointing yesterday along with the CB Leading Index statistics, but it is possible that traders may be positioning themselves for the Bank of England’s Inflation Report including a press conference by Governor Mervyn King addressing the issues. It could be a difficult balancing act for the BoE today as it addresses sluggish growth and rather troubling inflation figures. The U.K. economy is still under a vast array of pressure, while the austerity measures enacted by the government two months ago were received well by GBP traders, this has not put the poor dynamics for the British economy to rest. The Sterling has done well over the past couple of months, but it may be running into a difficult patch if risk appetite decreases.
Written by bforex.com