The cross has continued lower this morning, presently down at .9180 compared to a European opening around .9280. Sources report “swiss names” being particularly aggressive sellers, go figure.
Sterling has benefitted from the release of stronger than expected inflation data, which has helped dampen deflationary fears. At the same time Bank of Englands’ Mervyn King has this morning told Parliament that the central bank’s purchases of gilts in its quantitative easing programme may end up being less than the planned £75 bln. The official also feels there is no reason why sterling should go any lower.
On the otherside of the coin ECB’s Liikanen said the ECB has additional room for manoevre in all key policy rates and opined that regarding non-standard measures (quantitative ease), all options should be kept open.
