Forex Flash: Positive Spanish and Irish news overshadowed – OCBC Bank

Emmanuel Ng of OCBC Bank notes that the positive news flow out of Spain (debt auction) and Ireland (agreement with the ECB to reduce the debt burden) were overshadowed by Draghi’s comments yesterday and in the near term, any breach of the 1.3385 floor may risk a dip towards 1.3300.

He feels that intra-day, markets may remain relatively neutral on the pair pending further developments. Looking to GBP/USD he sees that given the ongoing rotational behaviour in the markets and underlying economic vulnerabilities, the pair may continue to remain inherently heavy in the interim despite the slight reprieve provided by Carney on Thursday. At this juncture, our bias remains for the pair to gravitate towards the lower bounds of a 1.5600-1.5800 range.