The British pound dropped again on Thursday vs US dollar, but this time reasons came from the UK. Bank of England’s (BoE) governor Mark Carney spoke in Sheffield, talking down the sterling as he explained that pace of rate-hikes could be affected also by exchange-rate. This time his focus turned to EUR/GBP currency pair, but his speech automatically dragged down UK currency against all of its major counterparts.
“The BOE may have to acknowledge that early rate hikes and a stronger pound will need to be mutually exclusive,” Carney added.
As expected, QE-driven euro, remaining in bearish trend, helped sterling to advance markedly since January from above £0.77 level and fuelled its continuing gains, albeit against the US dollar remained UK currency subdued.
If sterling continues to be sold, we may expect first resistance level on EUR/GBP at £0.7283, while second could be seen at £0.7443.
On the other hand, support level is seen at psychological £0.70, second stronger support comes at £0.6678.
