Archived IMT (2009.10.20)

There is NO CHANGE IN STERLING WEAKNESS. GBPUSD still struggles at $1.64, EURGBP consolidates at the 0.91 base and GBPJPY dissipates at 148.50s. Qatar Holding sales of 379 million shares in Barclays puts a small dent in risk appetite. But the overall concern for GBP is not only the inability for the BoE to talk exit strategy but also the widely expected move towards further asset purchases (QE), which should be GBP negative. While we reiterate the 5-week topping failure at 1.64, we could see a gains stretch towards 1.6450s before pullingback towards the 1.6310s.