For the 24 hours to 23:00 GMT, GBP fell 0.26% against the USD and closed at 1.5669.
The Moody’s Investors Service lowered gross domestic product (GDP) forecast for UK to 0.4% in 2012 and 1.8% in 2013. However, it retained its negative outlook and triple-A credit rating on the nation.
Meanwhile, the market participants continued to focus primarily on events in the Euro-zone and the US, looking for signs from policymakers of further quantitative easing. Traders speculated that Pound could be vulnerable if a steady stream of poor UK economic data pushed the Bank of England closer to more quantitative easing or even a 25 basis point rate cut. Consensus however remained that the Bank of England’s Monetary Policy Committee (MPC) to leave both policy stances unaltered when it meets on Thursday.
In the Asian session, at GMT0300, the pair is trading at 1.5674, with the GBP trading marginally higher from yesterday’s close.
This morning, in the UK, BRC shop price index rose 1.0% (YoY) in July, in line with the market expectation.
The pair is expected to find support at 1.5624, and a fall through could take it to the next support level of 1.5574. The pair is expected to find its first resistance at 1.5726, and a rise through could take it to the next resistance level of 1.5778.
Trading trends in the pair today are expected to be determined by the release of Purchasing Manager Index (PMI) manufacturing and Nationwide house price data in the UK.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.