Investing.com - The pound extended losses against the U.S. dollar on Thursday, as renewed concerns over Europe’s ailing banking sector and after mixed results at a French bond auction weighed on demand for riskier assets.
GBP/USD 1.5512 during European afternoon trade, the pair’s lowest since January 3; the pair subsequently consolidated at 1.5532, declining 0.56%.
Cable was likely to find support at 1.5450, the low of December 13 and resistance at 1.5668, the high of January 3.
Risk appetite came under pressure after a report on Wednesday showed that that overnight deposits at the European Central Bank reached an all-time high this week, indicating that European banks remain unwilling to lend to each other.
Meanwhile, France sold EUR4.02 billion of 10-year bonds at an average yield of 3.29%, compared with 3.18% at a similar auction last month. Bids exceeded the amount sold 1.6 times, down from a bid-to-cover ratio of 3.1 in December.
France is seen as vulnerable to losing its triple-A credit rating in the coming weeks, after it was put on negative watch by ratings agencies Standard & Poor’s and Fitch’s in December, amid concerns over the handling of the financial crisis in the euro zone.
In the U.K., a report earlier showed that service sector activity unexpectedly accelerated to a five-month high in December, easing concerns that growth in the country's economy is faltering.
Markit’s U.K. service sector purchasing managers' index rose to 54.0 last month, its highest level since July, confounding expectations for a decline to 51.6.
Elsewhere, sterling was higher against the euro with EUR/GBP shedding 0.19%, to hit 0.8270.
Later in the day, the U.S. was to release the ADP report on private sector employment as well as data on initial jobless claims and service sector activity.
GBP/USD 1.5512 during European afternoon trade, the pair’s lowest since January 3; the pair subsequently consolidated at 1.5532, declining 0.56%.
Cable was likely to find support at 1.5450, the low of December 13 and resistance at 1.5668, the high of January 3.
Risk appetite came under pressure after a report on Wednesday showed that that overnight deposits at the European Central Bank reached an all-time high this week, indicating that European banks remain unwilling to lend to each other.
Meanwhile, France sold EUR4.02 billion of 10-year bonds at an average yield of 3.29%, compared with 3.18% at a similar auction last month. Bids exceeded the amount sold 1.6 times, down from a bid-to-cover ratio of 3.1 in December.
France is seen as vulnerable to losing its triple-A credit rating in the coming weeks, after it was put on negative watch by ratings agencies Standard & Poor’s and Fitch’s in December, amid concerns over the handling of the financial crisis in the euro zone.
In the U.K., a report earlier showed that service sector activity unexpectedly accelerated to a five-month high in December, easing concerns that growth in the country's economy is faltering.
Markit’s U.K. service sector purchasing managers' index rose to 54.0 last month, its highest level since July, confounding expectations for a decline to 51.6.
Elsewhere, sterling was higher against the euro with EUR/GBP shedding 0.19%, to hit 0.8270.
Later in the day, the U.S. was to release the ADP report on private sector employment as well as data on initial jobless claims and service sector activity.