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The pound continues to trade with a weakening bias against most currencies, but is slightly higher against the dollar. BoE MPC member Weale over the weekend confirmed again that the BoE is in no hurry to tightening policy, which is keeping a lid on further gains against the greenback and the Euro, but with the Fed hike out of the way the Fed’s promise of a gradual tightening path, has in turn helped to keep USD under control. Still, with the BoE pushing the lift off further out we see Cable grinding lower going ahead.

U.K. public borrowing higher than expected in November, at GBP 14.2 billion, up from GBP 12.9 billion in the previous month. Expectations had been for a slight drop in the deficit, so the data are disappointing and bring the total for this year to GBP 66.9 billion.

Sterling is testing support at 1.4875.  A break of this level would lead to a test of support of the 2015 lows at 1.4580.  Resistance is seen near the 10-day moving average at 1.5025.  Momentum is negative with the MACD (moving average convergence divergence) index recently generating a sell signal.  The index is printing in the red with a downward sloping trajectory which points to lower prices. The RSI moved lower with price action reflecting accelerating negative momentum.

Article by ForexTime

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