GBP/USD: BoE Ready To Add Stimulus If Positive Signs Fade

GBP/USD: BoE Ready To Add Stimulus If Positive Signs Fade

For the 24 hours to 23:00 GMT, GBP fell 0.45% against the USD and closed at 1.5948.

Earlier, the Pound traded higher, after reports showed that mortgage approvals in the UK rose more-than-expected to 31,175 in September, hitting a five-month high. Additionally, the greenback remained supported after Moody’s downgraded credit-ratings on the Spanish regions of Andalucia, Extremadura, Castilla-La Mancha, Catalonia and Murcia.

However, the Pound came under pressure, after the Bank of England (BoE) Governor, Mervyn King stated that the central bank is ready to add more stimulus if the recent positive signs in the economy fade. He further stated that the recovery and rebalancing of the UK economy are proceeding at a slow and uncertain pace and at this stage, it is difficult to know whether the recent positive signs would persist.

In the Asian session, at GMT0300, the pair is trading at 1.5943, with the GBP trading marginally lower from yesterday’s close.

The pair is expected to find support at 1.5897, and a fall through could take it to the next support level of 1.5852. The pair is expected to find its first resistance at 1.6005, and a rise through could take it to the next resistance level of 1.6067.