Investing.com - The pound was almost unchanged against the U.S. dollar on Wednesday, hovering close to an eight-month low as trading volumes remained thin ahead of the New Year holiday.
Heading into the final week of the year, trading volumes are expected to remain light as many traders already closed books, reducing liquidity in the market which could result in exaggerated moves.
GBP/USD hit 1.4845 during European morning trade, the session low; the pair subsequently consolidated at 1.4820.
Cable was likely to find support at 1.4786, Tuesday’s low and an eight-month trough and resistance at 1.4914, Tuesday’s high.
The dollar strengthened after the Conference Board reported on Tuesday that its consumer confidence index rose to 96.5 in December from 92.6 in November, whose figure was revised from a previously estimated 90.4.
Analysts had expected the index to rise to 93.8 this month.
Separately, the U.S. Bureau of Economic Anaysis said the goods trade deficit widened to $60.50 billion last month from $58.41 billion in October. Analysts had expected the trade deficit to widen to $60.90 billion in November.
The data came after mixed U.S. economic reports released last week failed to offer clues as to how fast the U.S. central bank will raise interest rates next year.
With the first U.S. rate hike since 2006 out of the way, investors are now focusing on the pace of future rate increases.
In the U.K., the Nationwide Building Society said home prices rose 0.8% in December, exceeding expectations for a 0.5% gain and after an uptick of 0.1% the previous month.
Sterling was lower against the euro, with EUR/GBP adding 0.12% to 0.7381.