Pound Finds Temporary Relief on Improved Government Budget Surplus
The UK government saw a better than expected 11.4 billion Pound budget surplus in January, according to the Office for National Statistics. The extra surplus was a result of the BoE’s first payment to the treasury of gilt-coupon income amounting to 3.8 billion Pounds from the quantitative easing program.
The Pound jumped about thirty points following the release, however those gains were soon erased as GBP/USD fell back to 1.5200. Earlier in the session, the pair set a new 2.5-year low at 1.5131. That level may now provide support, and resistance could be provided by a broken low at 1.5268.
The Euro continued to set new monthly lows in today’s session following a downturn in the composite PMI for output. News of a Spanish bond sale beating the maximum target failed to bring the single currency higher in Forex markets. Additionally, German Chancellor Merkel said that a confident Europe can emerge stronger from the crisis.
This afternoon, the US inflation for January will be announced, 1.6% is expected.
GBPUSD Daily: February 21, 2013
Chart created by Benjamin Spier using Marketscope 2.0
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