Investing.com – The pound advanced to a six-day high against the U.S. dollar on Tuesday, after data showing that U.K. consumer prices remained elevated in January fuelled expectations of a near term interest rate hike by the Bank of England.
GBP/USD hit 1.617 during European late afternoon trade, the pair’s highest since February 7; the pair subsequently consolidated at 1.6144, surging 0.65%.
Cable was likely to find support at 1.5981, Monday’s low and resistance at 1.623, the high of February 2.
Earlier in the day, official data showed annual consumer price inflation accelerated to 4%, in line with economists' forecasts, from 3.7% in December. That is double the BoE's target rate, forcing BOE Governor Melvyn King to write a letter to the Treasury.
In the letter, King said inflation was likely to rise towards 5% in the coming months and was as likely to be above target as below in the next two to three years if interest rates were to rise in line with market expectations.
The pound was also up against the euro, with EUR/GBP shedding 0.53% to hit 0.8364.
Elsewhere Tuesday, official data showed U.S. retail sales rose in January for the seventh straight month, but the increase was smaller than expected.
U.S. import prices, meanwhile, rose much more than expected in January as costs increased for energy, food, and industrial supplies. A separate report showed that manufacturing activity in New York continued to expand in February.
GBP/USD hit 1.617 during European late afternoon trade, the pair’s highest since February 7; the pair subsequently consolidated at 1.6144, surging 0.65%.
Cable was likely to find support at 1.5981, Monday’s low and resistance at 1.623, the high of February 2.
Earlier in the day, official data showed annual consumer price inflation accelerated to 4%, in line with economists' forecasts, from 3.7% in December. That is double the BoE's target rate, forcing BOE Governor Melvyn King to write a letter to the Treasury.
In the letter, King said inflation was likely to rise towards 5% in the coming months and was as likely to be above target as below in the next two to three years if interest rates were to rise in line with market expectations.
The pound was also up against the euro, with EUR/GBP shedding 0.53% to hit 0.8364.
Elsewhere Tuesday, official data showed U.S. retail sales rose in January for the seventh straight month, but the increase was smaller than expected.
U.S. import prices, meanwhile, rose much more than expected in January as costs increased for energy, food, and industrial supplies. A separate report showed that manufacturing activity in New York continued to expand in February.