GBP USD analysis: Sterling slips after BoE official’s comments

ForexNewsNow | Published on September 28, 2010 at 11:27 am

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GBP USD analysis - BoE official Adam PosenNEW YORK (Forex News Now) – The pound slipped against the dollar on Tuesday, retreating from a 7-week high, after a senior Bank of England official said he saw a “clear” case for undertaking more asset purchases in Britain.

In late U.S. currency market trading, GBP/USD hit 1.5804, down 0.16 percent on the day, after falling from 1.5896, cable’s highest since Aug. 10.

Speaking at an event in the north of Britain, Bank of England Monetary Policy Committee member Adam Posen said his is that any additional stimulus, undertaken to avoid a Japan-style protracted period of economic underperformance, should begin with purchases of gilts.

According to GBP USD analysis, cable was likely to touch support around the low of Sept. 21, 1.5504, and encounter immediate resistance around the high of Aug. 11, 1.586.

Sterling’s pared earlier losses against the greenback, however, after a report showed that U.S. consumer morale dropped more than expected in September.

The Conference Board research group said earlier that its index of U.S. Consumer Confidence dropped to 48.5 during the month, down from a revised 53.2 in August. Analysts had expected a lighter fall to 52.5 in September, according to two currency market trading news outlets.

Elsewhere, the pound slumped versus the yen: GBP/JPY traded at 132.49, down 0.7 percent, according to intraday analysis.

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