Investing.com – The euro edged higher against the pound on Wednesday, but gains were capped as investors remained wary amid concerns over a planned referendum by Greece and after better-than-expected U.K. construction PMI data.
EUR/GBP hit 0.8614 during European morning trade, the daily high; the pair subsequently consolidated at 0.8612, gaining 0.25%.
The pair was likely to find support at 0.8547, Tuesday’s low and a one-month low and short-term resistance at 0.8647, the high of October 5.
Earlier in the day, Greece's Prime Minister George Papandreou won the backing of his cabinet to hold a referendum on a EUR130 billion bailout package and was due to meet with French and German leaders to discuss the planned vote later in the day.
If Greece rejects the deal it would put the next tranche of aid to Athens in jeopardy, pushing the country closer to a default and increasing the risk of contagion in global financial markets.
In the U.K., a report earlier showed that that construction sector activity grew more-than-expected in October, rising to a five-month high.
The Markit/CIPS construction purchasing managers’ index jumped to 53.9 in October from 50.1 the previous month, far outstripping expectations for an increase to 50.2.
The report came after data on Tuesday showed that the manufacturing sector contracted at its fastest pace in over two years in October.
The euro was also higher against the U.S. dollar, with EUR/USD rising 0.54% to hit 1.3776.
Later Wednesday, the U.S. was to release private sector data on non-farm payrolls. Meanwhile, the Federal Reserve was to conclude its two-day policy-setting meeting; Fed Chairman Ben Bernanke was to conduct the bank’s post-policy meeting press conference.
EUR/GBP hit 0.8614 during European morning trade, the daily high; the pair subsequently consolidated at 0.8612, gaining 0.25%.
The pair was likely to find support at 0.8547, Tuesday’s low and a one-month low and short-term resistance at 0.8647, the high of October 5.
Earlier in the day, Greece's Prime Minister George Papandreou won the backing of his cabinet to hold a referendum on a EUR130 billion bailout package and was due to meet with French and German leaders to discuss the planned vote later in the day.
If Greece rejects the deal it would put the next tranche of aid to Athens in jeopardy, pushing the country closer to a default and increasing the risk of contagion in global financial markets.
In the U.K., a report earlier showed that that construction sector activity grew more-than-expected in October, rising to a five-month high.
The Markit/CIPS construction purchasing managers’ index jumped to 53.9 in October from 50.1 the previous month, far outstripping expectations for an increase to 50.2.
The report came after data on Tuesday showed that the manufacturing sector contracted at its fastest pace in over two years in October.
The euro was also higher against the U.S. dollar, with EUR/USD rising 0.54% to hit 1.3776.
Later Wednesday, the U.S. was to release private sector data on non-farm payrolls. Meanwhile, the Federal Reserve was to conclude its two-day policy-setting meeting; Fed Chairman Ben Bernanke was to conduct the bank’s post-policy meeting press conference.