Sterling Gets The Wobbles

The pound suffered another case of the jitters this morning, falling below $1.64 before rebounding slightly to hover around the $1.6440-1.6450 range.

Last week's surprise decision to increase QE spending by GBP50 billion to GBP175 billion has weighed on the pound ever since.

This morning's jobs data said that the unemployment rate rose to 7.8 percent in June from 7.6 percent in May. The claimant count for July was up 24,900 from 23,800 in June.

Last week's highs above $1.70 already seem a million miles away. Bearish momentum has been building up since last week's QE announcement. There is concern that the BoE are dithering, not sure what to do for the best.

The market now awaits the BoE's quarterly Inflation Report due at 10.30 BST. A downwards revision in it's forecasts for inflation would put sterling under further pressure.