U.K. pound drops in FX trading
The sterling has pulled back in currency trading on the FX market today, mainly on the news that S&P rating are in. It is clear from British economic data that recovery is still a ways off. Even though there are hopeful signs of stabilization, conditions remain somewhat fragile, reports Action Forex:
It is so obvious that markets conditions are still fragile and market rallies cannot sustain for long, hence the whipsaws we see in currencies as traders are unsure of the short term market direction.
As a result of the uncertainty, the sterling is pulling back in currency trading. There are concerns that things could change quickly, and that is leading some forex traders back to the U.S. dollar as a safe haven currency. The euro is also dropping in forex trading today. It appears that there was a bit of overconfidence in these higher yielding currencies, and now that confidence has been shaken a bit — or at least forex traders don’t feel that economic recovery is immediately at hand.
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