Forex - Sterling dropped to a 3-month low as Forex traders are pricing in further BoE rate cut
The Euro was hit after an index of German business sentiment came in close to a one-year low, prompting investors to increase year-end Dollar buying. Large institutional investors helped pushed Sterling below the 2.0000 for the first time since September, with traders pricing in another interest rate cut after minutes from the Bank of England’s last meeting this month showed unanimous support for a cut to 5.5%.
Volumes were typically light ahead of year-end and Forex traders said that exaggerated some of the price action. The trading ranks are likely to think out further as the week goes on, b t those who remain at their desks will get weekly jobless claims and the Philadelphia Fed’s manufacturing index to scour for clues about US economic health.