Investing.com - The pound edged higher against the U.S. dollar on Wednesday, after the Bank of England’s February inflation report dampened expectations for further quantitative easing.
GBP/USD pulled away from 1.5676, the session low, to hit 1.5712 during European early afternoon trade, easing up 0.11%.
Cable was likely to find support at 1.5644, Tuesday’s low and a two-week low and resistance at 1.5769, Tuesday’s high.
The BoE raised its inflation forecast for two years time to a higher-than-expected 1.8% up from 1.3% in November's report.
But the pound remained under pressure after BoE Governor Mervyn King said that economic growth is likely to alternate between expansion and contraction in 2012 and warned that the euro zone crisis remains the biggest threat to the U.K. economic recovery.
A report earlier showed that the number of people claiming unemployment benefits in the U.K. rose more-than-expected in January, while the unemployment rate held steady at 8.4%, the highest level since 1996.
The U.K. Office for National Statistics said that the claimant count rose by a seasonally adjusted 6,900 in January, above expectations for an increase of 3,200.
Meanwhile, investors continued to monitor developments in the euro zone after European finance ministers replaced a meeting scheduled for later in the day with a conference call, after failing to receive assurances on how Athens plans to implement austerity measures approved in a parliamentary vote on Sunday.
The pound was almost unchanged against the euro, with EUR/GBP dipping 0.01% to hit 0.8366.
Sentiment on the euro was dented earlier after official data showed that euro zone’s gross domestic product shrank by a seasonally adjusted 0.3% during the fourth quarter and grew by just 0 .7% during 2011 as a whole.
Later Wednesday, the U.S. was to release a report on manufacturing activity in the New York region, as well as data on industrial production and the capacity utilization rate. In addition, the Federal Reserve was to publish the minutes of its most recent policy meeting.
GBP/USD pulled away from 1.5676, the session low, to hit 1.5712 during European early afternoon trade, easing up 0.11%.
Cable was likely to find support at 1.5644, Tuesday’s low and a two-week low and resistance at 1.5769, Tuesday’s high.
The BoE raised its inflation forecast for two years time to a higher-than-expected 1.8% up from 1.3% in November's report.
But the pound remained under pressure after BoE Governor Mervyn King said that economic growth is likely to alternate between expansion and contraction in 2012 and warned that the euro zone crisis remains the biggest threat to the U.K. economic recovery.
A report earlier showed that the number of people claiming unemployment benefits in the U.K. rose more-than-expected in January, while the unemployment rate held steady at 8.4%, the highest level since 1996.
The U.K. Office for National Statistics said that the claimant count rose by a seasonally adjusted 6,900 in January, above expectations for an increase of 3,200.
Meanwhile, investors continued to monitor developments in the euro zone after European finance ministers replaced a meeting scheduled for later in the day with a conference call, after failing to receive assurances on how Athens plans to implement austerity measures approved in a parliamentary vote on Sunday.
The pound was almost unchanged against the euro, with EUR/GBP dipping 0.01% to hit 0.8366.
Sentiment on the euro was dented earlier after official data showed that euro zone’s gross domestic product shrank by a seasonally adjusted 0.3% during the fourth quarter and grew by just 0 .7% during 2011 as a whole.
Later Wednesday, the U.S. was to release a report on manufacturing activity in the New York region, as well as data on industrial production and the capacity utilization rate. In addition, the Federal Reserve was to publish the minutes of its most recent policy meeting.