Light data day causes pound to weaken vs. USD

In a day devoid of any major economic data releases, the pound struggled to hold its value against the greenback yesterday, eventually losing nearly a cent to close at $1.6415.

• Despite the continued growth in global stock prices, the pound failed to post gains against the greenback, with analysts saying that sterling would remain under broad selling pressure in the short-term on the view that the BoE is delving deeper into quantitative easing than other central banks.
  
• The dollar, which usually declines when risk sentiment picks up, gained significant ground against the pound, which has led some analysts to suggest that risk reward is gradually moving in favour of long dollar positions on expectations for a stronger US recovery.
  
• The dollar’s resistance also comes as investors shy away from bold risk taking activity before a week of important economic data releases.
  
• US consumer confidence data, released today at 15:00BST, will give analysts a further indicator into current investor behaviour.