BZ: Pound dips against dollar as euro slides broadly lower
Forex Pros – The pound edged lower against the U.S. dollar on Monday, after the euro fell sharply across the board and amid an absence of drivers ahead of the release of U.K. inflation data on Tuesday.
GBP/USD hit 1.5981 during European early afternoon trade, the daily low; the pair subsequently consolidated at 1.5991, dipping 0.09%.
Cable was likely to find support at 1.5912, the low of January 31 and resistance at 1.6112, Friday's high.
The pound was pressured lower after the euro's slide, which came following reports that talks to come up with a rescue deal for ailing German lender WestLB stalled over the weekend, as they entered the final stretch to present a restructuring plan to the European Commission.
The pound has rallied since the beginning of the year amid growing rate-hike expectations, with markets looking to the Bank of England for decisive action as inflation has consistently over-shot the BOE's 2% target rate.
Meanwhile, the pound was higher against the euro, with EUR/GBP shedding 0.63% to hit 0.8409.
Earlier in the day, U.K. Business Secretary Vince Cable said he shared the analysis of the doves on the Bank of England's Monetary Policy Committee, saying an interest-rate increase was “potentially very difficult.”
