Sterling nearing fresh lows

Sterling on the back-foot as we head into a volatile afternoon...



The Pound is under pressure again today after starting the week positively. Investor confidence has been dented after a long list of developments recently that has put USD on the offensive. Rising oil prices and bond yields, stronger than expected US data and a falling equity market have contributed to a weaker GBP.

Things may improve or get worse come this afternoon, once we learn the stance of the ECB and with the release of the US' GDP number. Both are market movers and so the Pound will be tested. A decision to hold rates is priced into the Euro currently and ECB President Lagarde's comments will be watched closely to see if the ECB is noticeably more cautious on the economy than before. £-€ is flirting with a 5-month low and cable a 7-month low.

Yesterday, investment bank Danske downgraded their forecast on the Pound, citing that the UK will fall behind other economies further than initially anticipated next year. A 3% drop is their prediction for next year on GBP v EUR..