Sterling Rebounds from 10Day Low vs. Dollar

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LONDON, May 27 Reuters Sterling recovered from an overnight drop against the dollar that took it to a 10day low on Thursday, as the greenbacks spike higher fizzled out by the start of European trading.

Comments from a top Federal Reserve official on Wednesday that he was ready to open talks on tapering the U.S. central banks emergency support for the economy, as well as traders gearing up for inflation data due on Friday, helped give the dollar a shortlived boost, pushing the pound to its lowest since May 17 in Asian trading hours.

By 0752 GMT in London however, sterling had steadied, trading flat against the buck at 1.4118.

Against the euro it traded 0.1 lower at 86.42 pence.

Recent movements in sterling have been dictated largely by the direction of the U.S. dollar, rather than any strong fundamental catalysts, analysts say.

The pound was also unaffected by comments from Scotlands First Minister Nicola Sturgeon on Wednesday that she was in talks with the Scottish Green Party to form a coalition that would cement a proindependence majority in the devolved parliament in Edinburgh ahead of a political fight for the future of the United Kingdom.

Sturgeon, the leader of the Scottish National Party SNP, said she had held discussions at her official residence on Tuesday with the Greens, who have promised to support a second independence referendum.

Sterling has been largely unaffected by the news that Scotland plans to hold an independence referendum once the pandemic…

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