Positive UK unemployment data was unable to buoy the pound in the wake of comments from Meryvn King

The pound tumbled to an intra-week low against the dollar yesterday after the BoE said recent weakness in sterling would continue to aid an export-led rebound.

• In early trading, the UK currency made hesitant gains after the Office for National Statistics said claims for jobless benefits rose by 12,900 in October, the slowest rate since April 2008 and far less that the official estimate .
  
• However, not too shortly after, the central bank's quarterly inflation report and Mervyn King's accompanying statement dampened the recent build up in confidence in the UK economy.
  
• The report did boost its forecast for growth and inflation, but continued to point toward maintaining low official interest rates well into 2010.
  
• The inflation projection showed a significant undershoot of the 2% target, which weighed on the pound. In addition the door for more quantitative easing was left far more ajar than people had anticipated.
  
• In this morning's session the pair is trading steadily around 1.6550, slightly below the overnight closing price. There is no data out in the UK today, though positive unemployment claims figures in the US, released at 13:30, may weaken demand for the haven currency.