Part of the bounce in EUR/USD this afternoon can be blamed on a rebound in EUR/GBP. From 0.8387 to this afternoon’s 0.8430 level.
Early in the day there was a growing hope that the BOE might actually raise rates at its meeting this Thursday. Then the market came to its sense and realized that the ECB is run by Ben Bernanke’s old office-mate from MIT.
Armed with that knowledge, the market soon realized that the BOE may never hike rates again, regardless of UK CPI…
