Sterling back above US$1.30 as sellers take breather

London

STERLING clawed its way back above US$1.30 on Thursday as investors, buoyed by a modest revival in risk appetite, booked profits on bets made against it, though the outlook for the currency remained grim after Britain's shock vote to leave the EU.

As European stock markets rose, demand for the safe-haven yen ebbed and the growth-linked Australian dollar weathered a cut in the country's credit rating outlook by Standard and Poor's.

Sterling was up 0.9 per cent against the US dollar at US$1.3044 , having skidded to a 31-year low of US$1.2798 on Wednesday. It is down over 14 per cent since the Brexit vote, with some analysts expecting it to drop to US$1.20 in coming months as the Bank of England prepares to ease monetary policy. "Sterling momentum has eased a bit here and perhaps a two-way market is a bit overdue, as investors will require new reasons to get even more short against the curren…