Market focus this morning returns to the more mundane, namely the BOE inflation report and press conference with Gov Mark Carney, and it will be interesting to see whether Cable can continue to build on its recent platform of support in the 1.5 region. This bounce higher has taken the pair back to test the 1.53 resistance but since this move the pair has fallen back and is now in consolidation as we wait the BOE.
Key elements to watch out for in the conference will be any hint of negative inflation, which has not been helped by the current slide in oil prices. The contents of any letter Mark Carney will be writing to the Chancellor to explain this situation and the expectation for UK economic growth, a hugely important political item given the election in May.
By Anna Coulling