The Pound Touched The Five Month Low Against The Dollar.

The pound weakened against the US dollar and hit a five month low. The intraday exchange rate decreased from 1.5204 to 1.5128.

Traders are concerned about a late speech by Carney, the governor of the Bank of England, to find out when Britain may start raising interest rates.

The pound weakened against the US dollar, mainly because investors bet that the Bank of England would raise interest rates later than the Fed.

Technically, in the hour chart of sterling against the US dollar, the exchange rate volatility is slant.

Technical indicators MACD (12, 26, 9) main line and signal line rise below zero axis, indicating that the price trend is empty.

The relative strength index RSI (14) is located near the 50 equilibrium position, which shows that the price is short term and dynamic equilibrium.

The technological trend shows that the exchange rate of the pound against the US dollar is still likely to continue in the short term.

Although German inflation has declined for the first time in eight months, it has increased.

The possibility of further action to stimulate the economy may be adopted, but the euro exchange rate

Still higher.

Adam Cole, head of foreign exchange strategy division at RBC Capital Markets, said: "it seems that the market totally refuses to digest the prospect of interest rates that the ECB and the Bank of England try to communicate, although the European Central Bank has tried to talk about the possibility of additional QE plans, while Carney referred to raising interest rates."

The central bank will follow the steps of the Federal Reserve to lift interest rates from the current historical lows.

However, given the fact that inflation in Britain is still at zero level, the Bank of England is not in a hurry to raise interest rates.

Investors expect that the central bank will not raise interest rates until the second half of 2016, which further increases the attractiveness of the US dollar.

Barclay, foreign exchange strategist Hamish Pepper, said: "we still think the pound is overvalued, and Britain faces very tight fiscal policy in the next few years, so the interest rate rises in Britain will only be later.

Moreover, this austerity will coexist with the uncertainty of the referendum on whether Britain stays in the EU. We do not think the market has fully digested this uncertainty.

We believe that all these factors will pressure the pound sterling against the US dollar. "