Sterling is trading just above its previous close against the US dollar at $1.5705. GBP/USD has been trading within a band of 100 pips since Tuesday's FOMC decision, with minimal fresh economic data released since then providing no impetus to break this range in either direction. The next major economic indicator for the UK will come next Tuesday when the UK's second-quarter GDP will be announced. Sterling has been underperforming recently with a number of economic indicators pointing to a contracting economy. The only saving grace for GBP/USD in recent weeks has been the weakness of the US dollar. However, if UK economic growth continues to slow, as many economists are expecting due to public sector spending cuts, then it would be reasonable to expect sterling to underperform. Over the past few months the correlation between GBP/USD and EUR/USD was stronger, with both currency pairs moving in the same direction most of the time. This was predominantly driven by sentiment towards risk appetite. However, in recent weeks this relationship seems to have decoupled, with sterling not necessarily taking part in euro rallies. This suggests that investors are beginning to place more emphasis on underlying fundamental trends and intrinsic value rather than buying or selling on the back of general risk appetite. In the meantime, the durable goods orders and new home sales in the US that are due for release this afternoon may determine whether this pair rounds off the week on a high. David Choe, London