Investing.com - The pound fell to three-week lows against the dollar on Wednesday after data showed that U.K. industrial production fell at the fastest rate in nearly a year in August, rising doubts over the outlook for third quarter growth.
GBP/USD hit 1.5952 during European afternoon trade, the lowest since September 18; the pair subsequently consolidated at 1.5958, shedding 0.77%.
Cable was likely to find support at 1.5891, the low of September 18 and resistance at 1.6120, the session high.
Sterling weakened broadly after the Office for National Statistics said U.K. industrial production fell 1.1% in August, defying expectations for a 0.4% increase, after inching up 0.1% in July.
The ONS said manufacturing production fell by a seasonally adjusted 1.2% in August, confounding expectations for a 0.4% increase.
Manufacturing production was down 0.2% on a year-over-year basis, well below expectations for a 1% gain.
A separate report showed that U.K.’s goods trade deficit narrowed to GBP9.63 billion in August from GBP9.94 billion in July, but analysts had expected the deficit to shrink to GBP9 billion.
The dollar remained supported after the White House said President Barack Obama will announce his nomination of Federal Reserve Vice Chairwoman Janet Yellen to head the U.S. central bank later Wednesday.
Ms. Yellen’s nomination boosted expectations Fed policy could remain accommodative for some time. If Ms. Yellen’s nomination is confirmed by the Senate, she will succeed Chairman Ben Bernanke, whose term ends January 31.
But investors remained cautious as a partial U.S. government shutdown dragged on into a second week, with few signs of progress towards a resolution ahead of an October 17 deadline to avoid a U.S. sovereign default.
President Obama repeated Tuesday that he will be only willing to enter negotiations with congressional Republicans after the government is reopened and the U.S. debt ceiling is raised without conditions.
Elsewhere, sterling was lower against the euro, with EUR/GBP rising 0.33% to 0.8465.
Investors were awaiting the release of minutes from the Fed’s September meeting later Wednesday, after the U.S. central bank surprised markets with a decision to keep its stimulus program on track.
GBP/USD hit 1.5952 during European afternoon trade, the lowest since September 18; the pair subsequently consolidated at 1.5958, shedding 0.77%.
Cable was likely to find support at 1.5891, the low of September 18 and resistance at 1.6120, the session high.
Sterling weakened broadly after the Office for National Statistics said U.K. industrial production fell 1.1% in August, defying expectations for a 0.4% increase, after inching up 0.1% in July.
The ONS said manufacturing production fell by a seasonally adjusted 1.2% in August, confounding expectations for a 0.4% increase.
Manufacturing production was down 0.2% on a year-over-year basis, well below expectations for a 1% gain.
A separate report showed that U.K.’s goods trade deficit narrowed to GBP9.63 billion in August from GBP9.94 billion in July, but analysts had expected the deficit to shrink to GBP9 billion.
The dollar remained supported after the White House said President Barack Obama will announce his nomination of Federal Reserve Vice Chairwoman Janet Yellen to head the U.S. central bank later Wednesday.
Ms. Yellen’s nomination boosted expectations Fed policy could remain accommodative for some time. If Ms. Yellen’s nomination is confirmed by the Senate, she will succeed Chairman Ben Bernanke, whose term ends January 31.
But investors remained cautious as a partial U.S. government shutdown dragged on into a second week, with few signs of progress towards a resolution ahead of an October 17 deadline to avoid a U.S. sovereign default.
President Obama repeated Tuesday that he will be only willing to enter negotiations with congressional Republicans after the government is reopened and the U.S. debt ceiling is raised without conditions.
Elsewhere, sterling was lower against the euro, with EUR/GBP rising 0.33% to 0.8465.
Investors were awaiting the release of minutes from the Fed’s September meeting later Wednesday, after the U.S. central bank surprised markets with a decision to keep its stimulus program on track.