Pound Slides After Carney Comments
The Pound Sterling came under heavy pressure and fell close to a 2-week trough versus the greenback after the Mark Carney, the Governor of the Bank of England, said that the central bank would respond promptly to signs of prolonged weakness in the UK economy. With the recent disappointing data, including a drop in retail sales to a level last seen more than two decades ago, that speech hit markets hard; currently money markets are pricing in a 60% likelihood of a 2020 rate cut, a rise from the December gauge which was at 50%. Ahead for today, markets are awaiting a Brexit-related vote from the UK Parliament.
The GBP/USD was trading at $1.3038, a loss of 0.4969% as of 11:24 am in the London trading session. The pair has ranged from a trough of $1.30169 to a high of $1.31250 in today's session. The EUR/GBP is higher at 0.8522 Pence, a gain of 0.5356% and off the earlier high of 0.85285 Pence.
Markets Look to US Labor Data
Market attention could shift to the US later today with the release of US unemployment data, and then tomorrow's release of new private sector jobs figures. ADP had reported yesterday that 202,000 new jobs had been added in December, well above the 160,000 which had been predicted; The previous reading had also been revised upward to 124,000 from 67,000. Tomorrow, the NFP figures are due out with analysts currently calling for a decline to 164,000 from 266,000 a month ago, and average hourly earnings remaining flat.