Investing.com - The pound edged higher against the U.S. dollar on Tuesday, but gains were expected to remain limited as demand for the greenback continued to be underpinned and concerns over political instability in Greece still weighed on market sentiment.
GBP/USD hit 1.5548 during European morning trade, the session high; the pair subsequently consolidated at 1.5535, adding 0.08%.
Cable was likely to find support at 1.5484, the low of December 23 and a 16-month low and resistance at 1.5667, the high of December 22.
The dollar remained broadly supported after final data last week showed that U.S. gross domestic product rose 5.0% in the third quarter, exceeding expectations for a growth rate of 4.3% and up from 3.9% in the three months to June.
The strong data fuelled further optimism over the strength of the U.S. economic recovery and added to expectations for the Federal Reserve to raise interest rates next year.
Meanwhile, markets were jittery after Greek Prime Minister Antonis Samaras said on Monday that he will recommend parliamentary elections are held on January 25, almost 18 months before his coalition's term was due to end.
The announcement came as Samaras failed in his third attempt to persuade lawmakers to back his candidate for head of state, forcing the legislature’s dissolution.
Earlier Tuesday, the Nationwide Building Society said that U.K. house price inflation rose 0.2% this month, confounding expectations for an increase of 0.3%, after a 0.3% gain in November.
Year-on-year, U.K. house prices rose 7.2% in December, below expectations for a 7.5% gain, after an increase of 8.5% the previous month.
Sterling was steady against the euro, with EUR/GBP inching up 0.01% to 0.7832.
Later in the day, the U.S. was to release data on consumer confidence.