The Pound Sterling Live

Indeed, the dollar has slipped across the board after a somewhat disappointing unemployment claims figure, falling short of the 332k forecast at 360k. Whilst building permits showed a slight increase, Core CPI only rose by 0.1 percent, missing the 0.2 percent target.

In addition, mid-Atlantic manufacturers slipped into contraction this month, according to a report released Thursday by the Federal Reserve Bank of Philadelphia.

The Philadelphia Fed’s index of general business activity within its regional factory sector declined to -5.2 in May from to 1.3 in April.

13:11: RBS pour cold water on UK's economic future

Just as everyone starts to feel a little better about the UK's economic future along come the bears from RBS.

Ross Walker, at the bank's RBS European Economics unit - says:

"There is a growing air of optimism around the UK – even Mervyn King sounded faintly upbeat at the May Inflation Report launch. Are the proverbial green shoots of recovery finally surfacing? We remain cautiously pessimistic.

"A flurry of better high-frequency data should not obscure entrenched macroeconomic imbalances and structural impediments. Our central scenario is for a modest pick-up in GDP growth but the defining feature of the UK economy will continue to be protracted deleveraging.

"Muted income growth, further fiscal consolidation, hesitant business investment and weaker external demand mean many of those green shoots will turn out to be weeds."

10:28: GBP/USD in a downtrend, forecasters expect more losses


Some technical insights into the GBP/USD.

 * Mike van Dulken, Head of Research at Accendo Markets:

"GBP/USD still in downtrend from 1.56. Support hindered declines much below 1.52, but pressure remains as USD benefits versus major peers."

 * Craig Erlam at Alpari:

"Sterling has been in a downward spiral against the dollar for the last week or so, since hitting the big 50 fib level. Yesterday’s candle though suggests that traders may be prepared to take a break from selling the pound, although that break may well be a brief one. Yesterday’s candle is a textbook spinning top, which given that it’s come following some heavy selling, is a bullish signal.

"On top of that, the RSI is crossing in oversold territory, if this cross is completed, it would also suggest that we’re going to see some form of retracement of the recent downtrend. That said, the pair only broke below the 50-day SMA on Tuesday, so this is likely to act as resistance now, as we saw yesterday. Today’s candle is also bearish again which means we may have already seen as much of a retracement as we’re going to.

"If this is the case, then the next target for the pair will be those previous lows around 1.5030, followed by this year’s lows of 1.4830. The pair should find support along the way around 1.5150 and 1.5075."

9:20: Latest pound sterling exchange rates


The British pound (Currency:GBP) is looking firm in the wake of the positive Bank of England Quarterly Inflation Report:

The pound to euro exchange rate is 0.05 pct down on Wednesday's close at 1.1829.
The pound to US dollar exchange rate is 0.22 pct lower at 1.5202.
The pound to Australian dollar exchange rate is 0.73 pct higher at 1.5507.

Please note: The above currency quotes are taken from the wholesale exchange rate markets - your bank will affix their own spread when passing on their rate. However, an independent FX provider will guarantee to beat your bank's offer, thus delivering more currency. Find out more here.

Pound sterling decline versus US dollar a reflection of USD strength, not GBP weakness

Lloyds Bank Research comment on the performance of sterling over the course of the past 24 hours:

"Yesterday’s Bank of England’s Quarterly inflation report saw slight upward revisions to the growth forecast while the inflation outlook was revised marginally lower, that triggered GBP initially higher but the press conference revealed little else and the GBP upside faded.

"While the labour statistics saw a muted market response, after revealing a relatively mixed picture with the claimant count declining more than expected but the employment number also fell in the 3-months to March by 43k, the largest decline since Sept 2011.

"The sentiment towards GBP remains relatively positive despite GBP/USD’s recent decline which has been largely due to USD outperformance as opposed to GBP weakness.  However, with little else significant on the UK calendar this week, GBP/USD looks likely to remain influenced by USD moves. GBP/USD should see initial support around yesterday’s low of 1.5174. EUR/GBP traded lower yesterday on euro weakness, but the 0.8400 level remains decent support."