Investing.com - The pound erased losses against the U.S. dollar on Monday, supported by upbeat manufacturing activity data from the U.K. although investors remained cautious amid ongoing concerns over Greece.
GBP/USD eased off 1.5030, the session low, to hold steady at 1.5074 during European morning trade.
Cable was likely to find support at 1.4988, the low of January 30 and resistance at 1.5163, the high of January 29.
The pound found some support after market research group Markit said that its U.K. manufacturing purchasing managers' index rose to 53.0 last month from a reading of 52.5 in December. Analysts had expected the index to inch up to 52.6 in January.
Commenting on the report, Rob Dobson, senior economist at survey compiler Markit, said, "At this rate, the sector will provide little meaningful boost to the economy in the first quarter."
Markets were still jittery after Greece's new government said it will not cooperate with the International Monetary Fund and the European Union and will not seek an extension to its bailout program, underlining fears over a clash with its international creditors.
Meanwhile, sentiment on the dollar remained vulnerable after the Commerce Department said in a report on Friday that the U.S. economy expanded 2.6% in the final three months of 2014, below expectations for a 3.0% gain and slowing sharply from growth of 5.0% in the three months to September.
Sterling was lower against the euro, with EUR/GBP rising 0.25% to 0.7515.
In the euro zone, Markit said that Germany's manufacturing PMI slipped to 50.9 in January from 51.0 the previous month, confounding expectations for the index to remain unchanged.
France's manufacturing PMI ticked down to 49.2 this month from 49.5 in December. Analysts had also expected the index to remain unchanged in January.
For the entire euro zone, Markit reported that the manufacturing PMI held steady at 51.0 this month, in line with expectations.
Later in the day, the U.S. was to produce a report on personal income and spending. The Institute of Supply Management was also to release data on manufacturing activity.