Like most of the majors, GBPUSD responded to the global effort by central banks to inject short-term liquidity into the markets. The pound rallied from peak to trough nearly 200 points after the plan was unveiled. For the Bank of England’s part, officials said they were increasing the size of reserves to be auctioned and broadening the range of collateral they were willing to accept for three-month loans. This is a promising first step for the UK economy as lending and housing sentiment continue to suffer from sticky credit markets; though it will likely be some time before the worldwide problem is resolved. From the economic docket, labor data was setting new records. A pleased Prime Minister Gordon Brown presented parliament with an 11,100 drop in jobless claims through November, bringing the overall number of Brits collecting unemployment benefits to its lowest level since 1975. At the same time, the jobless rate matched a 32-year low. Though, despite these numbers, pound traders were little impressed, suggesting bulls have grown accustomed to a strong labor market.
