GBP/USD Approaches 5-Month High Prior to BoE Minutes

GBP/USD Approaches 5-Month High Prior to BoE Minutes

The GBP/USD pair is trading near its highest level in five months before the minutes are published from the Bank of England’s most recent meeting. Concerns regarding the U.K.’s double-dip recession will be on traders’ minds throughout the current trading day.

The GBP/USD hit $1.6264 this morning, a gain of 0.13% for the day. Meanwhile, the cable is trading lower versus the euro at £0.8037.

The latest losses for the USD and the gains for riskier currencies is largely owed to the introduction of QE3, rather than positive data from the Eurozone and other economies.

There is a certain degree of instability in the markets as Spanish Prime Minister Mariano Rajoy is reluctant to ask the European Central Bank for a full bailout due to the ECB recently going ahead with a bond-buying program. However, the nations’ other leaders will not rule out asking for a full bailout in the near future.

It is important that you follow the events later today such as the the Bank of England Governor Mervyn King testifying with several other members of the Monetary Policy Committee with regards to inflation and the economic outlook of the U.K. economy.

The U.S. is set to publish a string of important economic data releases later today. For example, the crude oil inventories will be pivotal in driving the price of crude oil and natural gas during this afternoon’s session. In addition, there will be important housing figures which traders will be following closely while trading the dollar and its other main currency counterparts.