Main feature of this morning’s session is sterling weakness. Cable having started around 1.6620 is down at 1.6490 presently. We’ve been as high as 1.6660 and as low as 1.6473 inbetween.

Cable stood around 1.6625 just ahead of the release of CPI data. The stronger than expected data saw a knee-jerk rally to 1.6660 (blink and you’d have missed it) where the pairing ran into a wall of selling.

Cable was standing round 1.6610 (or so I’ve been told) when BOE’s King, during testimony to a parliamentary committee, dropped a bombshell. He dropped into the conversation the fact that the Old Lady is considering cutting the reserve deposit rate (see above)

Cable slumped quickly in the wake of the comment, reaching a session low 1.6473 before steadying a little.

EUR/USD sits at 1.4610, hardly changed from an early 1.4620. Early talk had sell orders lined up at 1.4650, but we never got that far. China and the BIS sold up at 1.4635/40 early on and middle east names then jumped on the bandwagon. Finally Russia pushed it through the 1.4600 line.

However the pairing had recovered to hover just above 1.4600 when the release of German ZEW data hit the wires (see above). EUR/USD came under pressure after the release posting a session low 1.4579, before once again showing admirable resilience to rally back above 1.4600.

Talk of buy orders at 1.4570 down through 1.4550.

USD/JPY sits at 91.15 exactly where we started out. Uninspired narrow rangebound trade prevailed.

EUR/CHF up at 1.5165 from early 1.5125. Swissy not helped by weaker than expected industry orders (see above) Significant technical support down at 1.5110 has once again proven a durable downside barrier.