The pound reversed a three-day slide against the aussie, posting gains of nearly a cent as investors took an opportunity to lock in profits.
- During the morning session, the pound continued to push multi-year lows, hitting a price of 1.7333, as weak inflation data reinforced concerns over the strength of the UK economic recovery.
- UK consumer prices fell to a five-year low of 1.1% in September, dipping below the market’s estimate of 1.3%, due in part to lower utility bills and food prices.
- In addition, demand for the aussie remained strong as traders continued to favour gold over the US dollar, pushing the price to an all-time high.
- However, the pound made a comeback in later trading, rallying nearly two cents off record lows, as investors booked in profits.
- The pound was also supported by some upbeat comments from the BoE Deputy Governor, who stated that earlier fears of UK recovery were unfounded.