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Forex - Dollar trims early gains against pound

Published 05/02/2011, 07:55 AM
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EUR/GBP
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Investing.com – The pound trimmed losses against the U.S. dollar in holiday thinned trade on Monday, as concerns over loose monetary policy and lingering debt problems in the U.S. overshadowed news of news of Al Qaeda leader Osama Bin Laden’s death.

GBP/USD clawed back up from 1.6644, the daily low to hit 1.6692 during European afternoon trade, slipping 0.10%.

Cable was likely to find support at 1.6623, Friday’s low and short-term resistance at 1.6745, last Thursday’s high and a 17-month high.

Earlier in the day, the dollar was boosted by the perception that that bin Laden's death could make the U.S. less subject to further terrorist attacks, but some analysts remained skeptical of whether it would reduce the security risks facing the U.S.

Bin Laden was killed by U.S. forces during a gun battle at a compound outside Pakistan’s capital, Islamabad on Sunday. A Pakistani intelligence official described the raid as a "highly sensitive" joint intelligence operation.

The pound was also down against the euro, with EUR/GBP rising 0.32% to hit 0.8887.

Later in the day, the U.S. Institute for Supply Management was to publish its manufacturing PMI.

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