Investing.com - The pound extended losses against the U.S. dollar on Thursday, falling to a fresh five-week low as ongoing worries over the outlook for global economic growth and dampened expectations for further easing measures by the Federal Reserve continued to weigh.
GBP/USD hit 1.5434 during U.S. morning trade, the pair’s lowest since June 8; the pair subsequently consolidated at 1.5424, shedding 0.51%.
Cable was likely to find support at 1.5371, the low of June 6 and resistance at 1.5515, the session high.
Sentiment was hit after the European Central Bank’s monthly bulletin reiterated that downside risks have materialized and that growth in the region will remain weak.
Traders also remained jittery after Spanish Prime Minister Mariano Rajoy announced on Wednesday EUR65 billion of new austerity measures, in an effort to meet new budget-deficit targets agreed with euro zone partners.
Market analysts warned that the fresh austerity measures were likely to drag Spain’s economy deeper in to a recession.
In the U.S., official data showed earlier that the number of people who filed for unemployment assistance last week fell significantly more-than-expected, matching the lowest level in four years.
The Department of Labor said the number of individuals filing for initial jobless benefits in the week ending July 7 fell to a seasonally adjusted 350,000, compared to expectations for a decline to 372,000.
The data came after the Fed said in the minutes of its June policy meeting that the U.S. economy would have to worsen further before the central bank implements additional easing measures.
Sterling found support earlier after the U.K. saw borrowing costs fall to a record low at an auction of 10-year government bonds, as investors piled in to safe haven assets amid growing fears over the global economic outlook.
The U.K.’s Debt Management Office sold the full targeted amount of GBP3.5 billion worth of 10-year government bonds at an average yield of 1.71% earlier in the day, the lowest yield on record and down from 1.92% at a similar auction last month.
Elsewhere, the pound was trading close to a three-and-a-half year high against the euro with EUR/GBP easing up 0.03%, to hit 0.7898.
Also Thursday, official data showed that industrial production in the euro zone rose for the first time in three months in May, increasing by 0.6%. Analysts had expected a modest 0.1% decline.
GBP/USD hit 1.5434 during U.S. morning trade, the pair’s lowest since June 8; the pair subsequently consolidated at 1.5424, shedding 0.51%.
Cable was likely to find support at 1.5371, the low of June 6 and resistance at 1.5515, the session high.
Sentiment was hit after the European Central Bank’s monthly bulletin reiterated that downside risks have materialized and that growth in the region will remain weak.
Traders also remained jittery after Spanish Prime Minister Mariano Rajoy announced on Wednesday EUR65 billion of new austerity measures, in an effort to meet new budget-deficit targets agreed with euro zone partners.
Market analysts warned that the fresh austerity measures were likely to drag Spain’s economy deeper in to a recession.
In the U.S., official data showed earlier that the number of people who filed for unemployment assistance last week fell significantly more-than-expected, matching the lowest level in four years.
The Department of Labor said the number of individuals filing for initial jobless benefits in the week ending July 7 fell to a seasonally adjusted 350,000, compared to expectations for a decline to 372,000.
The data came after the Fed said in the minutes of its June policy meeting that the U.S. economy would have to worsen further before the central bank implements additional easing measures.
Sterling found support earlier after the U.K. saw borrowing costs fall to a record low at an auction of 10-year government bonds, as investors piled in to safe haven assets amid growing fears over the global economic outlook.
The U.K.’s Debt Management Office sold the full targeted amount of GBP3.5 billion worth of 10-year government bonds at an average yield of 1.71% earlier in the day, the lowest yield on record and down from 1.92% at a similar auction last month.
Elsewhere, the pound was trading close to a three-and-a-half year high against the euro with EUR/GBP easing up 0.03%, to hit 0.7898.
Also Thursday, official data showed that industrial production in the euro zone rose for the first time in three months in May, increasing by 0.6%. Analysts had expected a modest 0.1% decline.