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Forex - GBP/USD down after weak home price data, BoE rate decision

Published 07/08/2010, 10:28 AM
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Investing.com – The pound was down against the U.S. dollar on Thursday, after data showed U.K. house prices fell unexpectedly in May and after the Bank of England's decision to leave its benchmark interest rate unchanged.

GBP/USD hit 1.5124 during European afternoon trade, a daily low; the pair subsequently consolidated at 1.5146, shedding 0.29%.

Cable was likely to find short-term support at 1.5080, Wednesday's low and resistance at 1.539, the high of April 30.

Earlier in the day, the Halifax Bank of Scotland said U.K. house prices fell 0.6% in May, after declining 0.4% in April.

Analysts had expected an advance of 0.6% in May.

Commenting on the report, Martin Ellis, housing economist said "The mixed pattern of monthly price rises and falls so far this year is consistent with a slowing market and is in line with our view that house prices will be flat during 2010 as a whole".

Also Thursday, the BoE's monetary policy committee voted to keep its benchmark interest rate unchanged at 0.5%.

The pound was also down against the euro, with EUR/GBP gaining 0.69% to hit 0.8374.

Earlier in the day, U.S. official data showed that the number of people filing claims for initial jobless assistance fell to a seasonally adjusted 454,000 in the week ending July 3, after advancing 475,000 in the preceding week, whose figure was revised up from 472,000.

Analysts had expected a figure of 460,000 in the week ending July 3.

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