Intraday Market Thoughts

Archived IMT (2008.10.21)

by Ashraf Laidi
Oct 21, 2008 22:52

Once again, sterling collapses well below my projected downside target, shedding 3 cents in the last 2 hours to accumulate more than 5 cents on the day and hit a fresh 5-year low of $1.6650. My $1.67 target was projected for later in the week but the combination of the worst CBI survey in 28 years and remarks from Bank of England Governor Mervyn King using the word recession and indicating that a sharp decline in UK inflation has opened the door for a 50-bp cut next month to 4.00%. Inflation has long been the main obstacle to these overdue BoE rate cuts, and such remarks comprise a major negative for the currency against USD (1.657), JPY (1.65) and CHF (1.87). Fed intervening in money market funds, Kerkorian disposing 6% of Fords stock and corp. earnings on the disappointing side underline the realities of the day for equities, risk appetite and high yielding FX. More downside for high yielders seen in Wednesday Asian session.


Latest IMTs