Sterling Digest: March 6, 2012

Australia. The Golden State. The Economist (cover)

Screw the headlines. Markets fell today on a neutral RBA.

What a difference a day makes. Profits were quickly taken this morning as sterling falls back across the board. The stark contrast to yesterday’s bullishness is what markets are made of. FIVE central bank decisions in a week will do that. RBA killed the AUD to kick off this Tuesday trading session. A neutral RBA acknowledged a slower economy yet still left a small signal for further monetary easing. Investors sought out USD and JPY sending $GBPUSD and $GBPJPY to new lows. Risk aversion dragged sterling down against everything else with $GBPCAD, $GBPNZD, $GBPAUD, $GBPCHF all down on the day.

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