Positioning ahead of Thursday's BOE MPC.......>

CABLE: Positioning ahead of Thursday's BOE MPC announcement (noted as a live

event) saw sterling come under further pressure through Tuesday trade. Some

suggested month-end EUR/GBP demand, hedging ahead of the decision, could have

been an early driver. Cable eased to a low of $1.2975 before it recovered

through the 1600GMT fix to $1.3029 into the close. Trade through Asia was

confined to a $1.3015/30 range before Europe pressed rate down to $1.3008 at the

open. Nationwide House Price data released at the open showed a modest pick-up

in growth, but this was brushed aside in favour of general USD demand. Despite

this move lower in sterling there is some underlying buoyancy seen, market split

over Thursday's MPC rate decision. Recently released poor hard data seen

supporting calls for a rate cut, but countered by UK Jobs data, and forward

looking confidence data. If the Bank does cut would it be viewed as one and

done? Despite EUR/GBP's Tuesday rally it held below its technically key 10-dma

which keeps the outlook in the cross as bearish. 

- Cable support $1.3000, $1.2985/75, $1.2960/50. Resistance $1.3030/40, $1.3050,

$1.3065/75. .