Investing.com - The pound rose to two-month highs against the dollar on Wednesday as widespread speculation over the timing of possible tapering by the Federal Reserve continued to dominate market sentiment.
GBP/USD hit 1.5701 during European afternoon trade, the pair’s highest since June 18; the pair subsequently consolidated at 1.5691, gaining 0.15%.
Cable was likely to find support at 1.5608, Monday’s low and resistance at 1.5736, the high of June 13.
Investors were looking ahead to the release of the minutes from the Fed’s July meeting later in the trading day for further indications as to when the central bank may start to unwind its USD85 billion-a-month asset purchase program.
Market sentiment has been hit by mounting expectations that the Fed may start to phase out stimulus measures, known as quantitative easing, as soon as next month.
Fed Chairman Ben Bernanke has said that the decision to start tapering will depend on whether economic data is strong enough.
Sterling was boosted after a private sector report on Wednesday showed that U.K. manufacturing orders rose to a two-year high in August, adding to optimism over the economic recovery.
The Confederation of British Industry said its total orders index rose to zero from minus 12 in July. That beat expectations for a reading of minus 8 and was the highest since August 2011.
A separate report earlier showed that the U.K.’s public sector posted a deficit of GBP1.6 billion in July. It was the first deficit for the month of July, which usually shows a surplus due to tax payments, since 2010.
The pound rose to session highs against the euro, with EUR/GBP down 0.38% to 0.8531.
The U.S. was to release private sector data on new home sales later Wednesday.
GBP/USD hit 1.5701 during European afternoon trade, the pair’s highest since June 18; the pair subsequently consolidated at 1.5691, gaining 0.15%.
Cable was likely to find support at 1.5608, Monday’s low and resistance at 1.5736, the high of June 13.
Investors were looking ahead to the release of the minutes from the Fed’s July meeting later in the trading day for further indications as to when the central bank may start to unwind its USD85 billion-a-month asset purchase program.
Market sentiment has been hit by mounting expectations that the Fed may start to phase out stimulus measures, known as quantitative easing, as soon as next month.
Fed Chairman Ben Bernanke has said that the decision to start tapering will depend on whether economic data is strong enough.
Sterling was boosted after a private sector report on Wednesday showed that U.K. manufacturing orders rose to a two-year high in August, adding to optimism over the economic recovery.
The Confederation of British Industry said its total orders index rose to zero from minus 12 in July. That beat expectations for a reading of minus 8 and was the highest since August 2011.
A separate report earlier showed that the U.K.’s public sector posted a deficit of GBP1.6 billion in July. It was the first deficit for the month of July, which usually shows a surplus due to tax payments, since 2010.
The pound rose to session highs against the euro, with EUR/GBP down 0.38% to 0.8531.
The U.S. was to release private sector data on new home sales later Wednesday.