The pound is trading at session lows for the day with cable now down by 0.35% as price closes in on last week's low @ 1.3013. Further support is seen closer to 1.2995-00 next.
As things stand, the BOE is returning back into focus for the pound after recent comments by policymakers (⬆️) concerning a rate cut since the end of last week.
Tenreyro and Vlieghe are the latest to voice out such an opinion - alongside the two dissenters: Saunders and Haskel, and that is making a more compelling case for the BOE to potentially ease policy in its coming monetary policy meetings.
As such, this will keep UK economic data in keen focus especially on inflation and the labour market. Any significant deterioration in economic conditions might be the trigger to sway the BOE to cut rates as insurance and that should weigh on the pound further.
For now, sellers are still firmly in near-term control in cable (price under key hourly moving averages) and a further drop below 1.3000 should see a stronger extension of the downside momentum, especially if it is backed by weaker data this week.