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Forex - EUR/GPB extends gains after soft U.K. PMI data

Published 03/03/2011, 05:27 AM
EUR/USD
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EUR/GBP
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Investing.com – The euro extended gains against the pound on Thursday, rising to a three-day high after a weaker-than-expected survey of the U.K. services sector and data showing that euro zone retail sales rose slightly more-than-expected in January.

EUR/GBP hit 0.8519 during European morning trade, the pair’s highest since Monday; the pair subsequently consolidated at 0.8517, gaining 0.31%.

The pair was likely to find support at 0.8462, Wednesday’s low and resistance at 0.8554, Monday’s high.

Earlier in the day, data showed that growth in the U.K. service sector slowed sharply in February after January's weather-related rebound, as companies recorded job losses for the fifth month running.

The Markit/CIPS services purchasing managers index fell to 52.6 from January's eight-month high of 54.5, surpassing expectations for a decline to 53.5.

The report contrasted with surprisingly strong data for manufacturing and construction earlier in the week. A manufacturing PMI survey on Tuesday showed growth held at a record high in February, while data on Wednesday showed construction activity grew at its fastest pace in eight months.

Also Thursday, official data showed that euro zone retail sales rose 0.4% in January, slightly more than the expected 0.3% gain after dropping by 0.6% in December.

A separate report showed that showed that the euro zone's services sector grew less than initially projected in February.

Meanwhile, the euro was almost unchanged against the U.S. dollar, with EUR/USD dipping 0.01% to hit 1.3862.

Later in the day, the European Central Bank was to announce its minimum bid rate.

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