The pair is up by 0.1% to 1.1530 levels with the low earlier touching 1.1477 in European morning trade. As much as the announcement by UK PM Truss is a welcome development for households, it still won't be enough to really dig the UK out of a recession heading into next year.
Sure, there might be some relief to households but essentially it comes with a fiscal cost and the root of the energy problems are still not being addressed. In other words, this is another can being kicked down the road.
For me, the bounce in cable today seems to be a case of a rejection at the support near the March 2020 lows close to 1.1400:
It's a modest bounce but buyers will have to do more to convince of a stronger rebound. The 200-hour moving average at 1.1575 currently will be a key near-term level to watch in that regard. Otherwise, I still maintain that the path of least resistance is for the quid to move lower so long as the BOE looks the more likely of the two (against the Fed) to fold first in the monetary policy tightening race.
