Forex - GBP/USD erases early gains after soft U.K. lending data

Published 09/29/2010, 06:58 AM
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Investing.com – The pound erased early gains against the U.S. dollar on Wednesday, falling to a daily low, following the release of soft U.K. lending data.

GBP/USD retreated from 1.5874, the daily high, to hit 1.5802 during European morning trade, shedding 0.01%.

Cable was likely to find support at 1.5718, Tuesday's low and resistance at 1.5995, the high of August 9.

Earlier in the day, official data showed that British mortgage approvals fell to a 7-month low in August and consumers unexpectedly paid back some of their debts, adding to fears that the U.K. economic recovery is slowing.

The Bank of England said mortgage approvals fell to 47,372 in August, down from 48,346 in July, broadly in line with analyst's expectations. Meanwhile, net consumer credit fell by GBP 120 million pounds, the biggest drop since November 2009 and below forecasts for a GBP100 million increase.

The BoE's preferred gauge of M4 money supply growth picked up to 0.8% on the month but the broader measure of M4 showed its weakest annual rise on record.

Meanwhile, the pound was down against the euro, with EUR/GBP gaining 0.17% to hit 0.8611.

On Tuesday, data showed that U.S. consumer confidence fell significantly more-than-expected in September as consumers saw no improvement in the labor market.

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