UK Employment Report, released........>

EURO-STERLING: UK Employment Report, released Wednesday, provided an added boost

to sterling's recent recovery. This demand allowed EUR/GBP to clear its support

between Gbp0.8750/45, extending the move to Gbp0.8707 ahead of the US FOMC

announcement. Pressure on the USD, linked to the FOMC dot plot, boosted cable

though it trailed in the wake of the stronger reaction in EUR/USD which in turn

saw the cross edge back above Gbp0.8730. Rate consolidated through Asia within a

relatively tight range around Gbp0.8730, currently trading at Gbp0.8730 in early

Europe. Wednesday's move saw rate extend slippage outside of its 1.0% envelope,

drawn around its 10-dma. Not a support in its own right but rate tends to not

like being outside for too long, the 1.0% envelope base today comes in at

Gbp0.8726 and is in a downward trend itself but it may act to slow further

downside move. UK Retail Sales data at 0930GMT but most attention on the BOE MPC

announcement at 1200GMT. No change widely expected but attention will be to see

if there is a hawkish split in the vote, as well as any indication in the

Minutes for a hike in May. Support Gbp0.8707/00, a break to expose the 2018 low

of Gbp0.8687.