One week realised GBP/USD volatility is now 34%. Therefore, the GBP/USD could slump to the 1.07/08 area later in the day, economists at ING report.

400 pip ranges now the norm for cable

“Today the focus is on the PM and Chancellor meeting the Office for Budget Responsibility (OBR) to discuss spending plans. While the involvement of the OBR will be welcomed by the markets, the government still has to find a way to balance the books and avoid a very negative assessment from the rating agencies – two of which provide UK sovereign rating outlooks on 21 October.”

“A Conservative party conference this weekend suggests it is far too early for a U-turn on fiscal policy and, combined with a very difficult external environment, sterling should stay vulnerable.”

“4 big figure ranges could easily put cable back at 1.07/1.08 later today!”