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Sterling lending rates post negligible drop

Three month sterling libor has fallen by a negligible amount today, disappointing anyone who expected lending rates to come down swiftly after the Bank od England's emergency measures announced on Monday. This won't sit kindly with Chancellor Darling who is meeting the Council of Mortgage Lenders today and he will have been further frustrated by the news that Abbey have just announced a further increase to their mortgage rates. Cable has performed well this morning re-establishing itself above 1.9800 as some Eur/Gbp selling has pushed the cross down to 0.8020. Look out for a speech by BOE member Timothy Besley which is due at 12.15 GMT.

Thanks JT,

Have you ever used Tradestation as the broker or just prefer someone else?

Yes, getting it for free is a bonus which I'll easily do each month. I can't see why anyone would want to go with someone else, like e-signal for example, and pay for their platform when you can get it from elsewhere for free.

The time is wrong in this piece. It should read 13:00GMT.

12:33 GMT, Apr 22 2008 | Posted by Jamie Coleman from Boston
Forward-looking BOC set to trim 50 bp


With its biggest customer sucking wind, the BOC is set to trim its bank rate to 3.00% this morning to get in front of the slowdown in growth that the Governor of the BOC has been telegraphing since taking office earlier this year. Don't expect too much of a reaction if the BOC give the market what it expects, but expect a violent USD slide should the BOC unexpectedly take a go-slow approach on rate cuts. CAD crosses would likely benefit dramatically from an unexpected 25 bp cut as well. The rate move will be announced at 14:00 GMT, just under a half hour from now.

Otherwise, expect more 1.0000/1.0150.

06:59 GMT, Apr 23 2008 | Posted by Mark Mitchell from London
Some people just don't get it


Another Jean-Claude (there are a lot of them around) is speaking on the wires. This time it's Luxembourg Prime Minister and and Eurogroup President Jean-Claude Juncker who bemoans the excessive volatility in fx at the moment. When asked about Euro FX, he says markets should focus less on short-term info and that it was not the intention of the G7 to have led to results on FX we see today. Questioned specifically on the pricing in of an ECB rate rise in FX he said "I don't like the way things are developing" With 21 members on the ECB council, the ECB need to quickly get back to the days of "we speak with one voice"

08:35 *POUND JUMPS AFTER BOE MINUTES SHOW 2 VOTES FOR RATES TO BE LEFT ON HOLD
08:31 Asian inflation at fresh multi-year highs as fuel, food, housing prices climb
08:30 *BOE MPC MAJORITY SAID CUT NOW WOULD REDUCE 'TAIL RISK' OF AGGRESSIVE CUTS LATER
08:30 *BOE'S BESLEY/SENTANCE SAID RECENT ECONOMIC NEWS HAD HELD UP PRETTY WELL
08:30 *BOE'S BLANCHFLOWER SAID NEAR-TERM RISE IN INFLATION LIKELY TO BE 'SHORT-LIVED'
08:30 *BOE MPC MAJORITY HAD DIFFERENT VIEWS OF MEDIUM-TERM INFLATION RISKS
08:30 *BOE'S BLANCHFLOWER SAID LARGER CUT NEEDED TO STAVE OFF MARKED ECONOMIC SLOWDOWN
08:30 *BOE'S BESLEY/SENTANCE SAID PREMATURE CUT COULD FUEL INFLATION EXPECTATIONS
08:30 BoE MPC split 3 ways on April 10, with Sentance/Besley voting for rates on hold
08:30 *BOE MPC MAJORITY BACKED SMALL CUT TO HELP OFFSET CREDIT CRISIS' INFLATION HIT
08:30 *BOE MPC'S MAJORITY OF SIX, INC KING, VOTED FOR QUARTER POINT CUT TO 5.00 PCT
08:30 *BOE MPC'S BLANCHFLOWER ONLY MEMBER TO VOTE FOR HALF POINT CUT TO 4.75 PCT
08:30 *BOE MPC'S SENTANCE AND BESLEY ONLY MEMBERS VOTING FOR RATES TO STAY AT 5.25 PCT

Thanks for that Hil. Just to let you know there are people reading it :-)

Good to hear it, Seymour. This is how the market is looking at it.

08:46 GMT, Apr 23 2008 | Posted by Mark Mitchell from London
Confusion reigns on the MPC

Well it looks like the MPC couldn't be more confused if they tried ! When the vote came along for what action to take on rates 6 members went for a 25 basis point cut and surprise surprise Blanchflower went for a 50 basis point cut, but what is grabbing the market attention is the fact that Besley and Sentance went for no change. The BOE wlecomed the weakening housing maket saying that some fall in earnings/price ratio was probably warranted and the MPC majority felt that an april cut would reduce the risk of need for sharper moves later. It does look like a May cut is off the agenda, but if data continues to come in so poorly we feel that a June rate cut is now more likely. We will get a better idea of how the economy is performing over the next few days after Retail Sales, Nationwide House price survey and the first estimate of 1Q GDP. Sterling has ticked up slightly on this to 1.9940 in Cable and 0.8007 in Eur/Gbp

Hil,

I reckon we should form a Shadow MPC so that we can issue press releases and bitch about these people publicly. What fun we could have.

The Government and the MPC are now almost totally irrelevant in this mess. This morning, the 3 month LIBOR nosedived to, er, exactly where it was yesterday, 5.88% and change.

The Times has already beaten us to it with the idea of a Shadow MPC, DelBoy.

Maybe Money AM could form their own Shadow MPC though, as I'm always ready for a bitch.

Streuth:)

15:07 GMT, Apr 23 2008 | Posted by Mark Mitchell from London
Sentance and Nationwide up next for Sterling markets


The rollercoaster ride that is Cable has again had a busy day. After hitting 1.9973 early in the session, it has seen a gradual grind downwards only stopping for a small rally after the BOE minutes. We are now below 1.9800 with 1.9735 seen as the next level of support, while Eur/gbp has been contentedly oscillating around 0.8020 for most of the day. We have a couple of event risks coming up. Firstly we have Andrew Sentance speaking at the Confederation of British Industry at 17.00 GMT. Remember he should be quite hawkish as he voted against a Bank of England cut at the last meeting. Then, first out of the traps tomorrow at 06.00 GMT is the Nationwide House price survey for April. Expectations are calling for a monthly fall of 0.3% and a move to a yearly fall of 0.2 %. This would be the first yearly house price fall recorded by any survey and would serve to remind markets that when house prices start to fall it is difficult to stop them.

Cheers Hil. Kept off cable this morning because it was all over the place. Managed to get a bit of the ride down from midday, but missed most of the move :-|

Cable doesn't get much easier than today, Seymour. There have been fantastic signals from the HHG Oscillator on both the 5- and 15-minute charts for 3 winning trades since 7am.

Even if you didn't pick the best entry, they'd have done you well. I think you probably just need to take a big gulp, say wtf and press the mouse button. Then just hold your nerve, 'cause faint heart never won fair maiden.

You can do it!!!

Cheers Hil - my problem is some days I am so busy it's difficult to get to my screen. Didn't trade Monday, two yesterday and one today, all winners so winning but my maidens are smallish :-)

Will keep going.

There's a lot of market chatter around that fiber will print a key weekly reversal signal if it can close below 1.5670 at the end of the week.

"This would be a very bearish sign technically and would bring an immediate target of 1.5360 into play."

Thanks Hils, Weekly closing levels always interesting.

By the way do you have a book entitled: "Hils great sayings"..it could be a great seller with the right marketing!

Elliot wavers would have liked the ending diagonal triangle when the euro was around 1.60 so glad to see the confirmation from above

I'm studying Elliot Waves and pattern recognition at the moment. Look great when analysing past charts but in real-time seems a great deal of subjectivity is involved in places.

Does anyone use EW when trading Forex?

You're right imo in what you say, Foxey, great in hindsight but useless in real time.

I prefer my Up and Down StrategyTM. Buy it 'cause it's going up and sell it 'cause it's going down. And if it turns just after you've entered the market, cut your loss and reverse it quick.

Sterling is having another good day as stops are triggered on the break below 0.7850, just after Bavaria confirms the large fall in German inflation. Support is now seen at 0.7825 and then the key 0.7804 level which is the seven month channel base. Cable meanwhile looks to 1.9975, but may struggle as chatter concentrates on a 1.5600 Eur/usd option expiry this afternoon. It now looks like the Cable buying is rellated to a UK clearer buying on the hour, every hour (for now) for their dividend payment.