Investing.com - The pound erased losses against the U.S. dollar on Wednesday, pulling away from a three-day low as market sentiment found mild support ahead of a highly anticipated European Central Bank policy meeting on Thursday.
GBP/USD hit pulled back from 1.5826, the pair’s lowest since August 31, to hit 1.5890 during European afternoon trade, adding 0.12%.
Cable was likely to find support at 1.5790, the low of August 27 and resistance at 1.5970, the high of April 17.
Investors were awaiting the outcome of the ECB’s upcoming monetary policy meeting on Thursday, amid expectations that the bank will give further details on a long awaited bond-buying program designed to help ease funding pressures for indebted euro zone countries.
ECB President Mario Draghi told European lawmakers on Monday that purchases of short-term sovereign bonds to help debt-burdened countries like Spain and Italy would not breach European Union rules.
Market sentiment remained vulnerable however, amid growing fears that the central bank may disappoint.
Meanwhile, the pound remained supported after stronger-than-forecast service sector data for August fuelled hopes that the Bank of England would refrain from implementing further stimulus measures at its policy meeting on Thursday.
Markit said its services purchasing managers’ index rose to 53.7, the highest level since March, from a reading of 51.0 in July.
The data was inadvertently published by Reuters on Tuesday, a day ahead of schedule.
Elsewhere, the pound was higher against the euro with EUR/GBP shedding 0.28%, to hit 0.7897.
Also Wednesday, a report showing that service sector activity in the euro zone contracted at a slightly faster rate than initially estimated in August added to fears that the bloc is set to enter a technical recession in the third quarter.
Markit said that its revised services purchasing managers’ index ticked down to 47.2 in August from a preliminary reading of 47.5, defying expectations to remain unchanged.
Germany's services sector contracted at its fastest rate in three years, with the PMI coming in at 48.3.
GBP/USD hit pulled back from 1.5826, the pair’s lowest since August 31, to hit 1.5890 during European afternoon trade, adding 0.12%.
Cable was likely to find support at 1.5790, the low of August 27 and resistance at 1.5970, the high of April 17.
Investors were awaiting the outcome of the ECB’s upcoming monetary policy meeting on Thursday, amid expectations that the bank will give further details on a long awaited bond-buying program designed to help ease funding pressures for indebted euro zone countries.
ECB President Mario Draghi told European lawmakers on Monday that purchases of short-term sovereign bonds to help debt-burdened countries like Spain and Italy would not breach European Union rules.
Market sentiment remained vulnerable however, amid growing fears that the central bank may disappoint.
Meanwhile, the pound remained supported after stronger-than-forecast service sector data for August fuelled hopes that the Bank of England would refrain from implementing further stimulus measures at its policy meeting on Thursday.
Markit said its services purchasing managers’ index rose to 53.7, the highest level since March, from a reading of 51.0 in July.
The data was inadvertently published by Reuters on Tuesday, a day ahead of schedule.
Elsewhere, the pound was higher against the euro with EUR/GBP shedding 0.28%, to hit 0.7897.
Also Wednesday, a report showing that service sector activity in the euro zone contracted at a slightly faster rate than initially estimated in August added to fears that the bloc is set to enter a technical recession in the third quarter.
Markit said that its revised services purchasing managers’ index ticked down to 47.2 in August from a preliminary reading of 47.5, defying expectations to remain unchanged.
Germany's services sector contracted at its fastest rate in three years, with the PMI coming in at 48.3.