So Mr. King and his merry band of ostriches at the Bank of England have decided that the need to put up interest rates was sufficiently strong that they could not in good conscience wait for next month's inflation report. That sterling has rallied sharply (and the strip declined) should come as nor surprise. Slightly more puzzling is that AUD and NZD caught a bid on the back of the sterling rate rise. Evidently, a hike in the UK is more likely to drag money into the carry trade than suck liquidity out of it. Go figure.

Elsewhere, the SNB is clearly getting tired of seeing the CHF as the carry traders' whipping-boy (along with the yen, natch.) Today's strident comments from SNB presient Roth warned of an abrupt strengthening of the Swissie should the carry trade unwind, but obviously that is a conditional probability. The SNB has been moaning since 1.59 with no discernible effect.

Macro Man is getting an itchy trigger finger and wants to buy equities, but he'll give the market another day to prove its mettle.
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