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Forex - GBP/USD higher after U.K. data, but gains limited

Published 09/27/2013, 04:26 AM
GBP/USD
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EUR/GBP
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Investing.com - The pound was higher against the U.S. dollar on Friday, after data showed that U.K. house prices rose more than expected in September, although ongoing U.S. budget concerns continued to dominate market sentiment.

GBP/USD hit 1.6130 during European morning trade, the pair's highest since September 19; the pair subsequently consolidated at 1.6077, adding 0.22%.

Cable was likely to find support at 1.5956, the low of September 24 and resistance at 1.6146, the high of September 19.

Industry data showed that U.K. house price inflation rose 0.9% this month, exceeding expectations for a 0.5% gain, after an upwardly revised 0.7% rise in August.

Meanwhile, U.S. budget concerns persisted after Republican leaders in the U.S. House of Representatives refused on Thursday to give in to President Barack Obama's demand for straightforward bills to run the government beyond September 30 and to increase borrowing authority to avoid a default.

Congress must reach an agreement on the budged debate before October 1 to prevent a government shutdown that could involve federal employees facing unpaid temporary leave and a delay in the payment of military personnel.

Separately, the greenback remained under pressure as a recent string of U.S. economic reports underlined concerns over the outlook for the nation's economic recovery.

On Thursday, official data showed that the U.S. economy expanded by 2.5% in the second quarter, confounding expectations for a 2.6% expansion.

Last week, the Fed said it wanted to see more evidence of a sustained economic recovery before it reduced stimulus.

Sterling was higher against the euro with EUR/GBP slipping 0.13%, to hit 0.8398.

Sentiment on the euro remained fragile after European Central Bank Executive Board member Benoit Coeure on Thursday said the bank has room to cut interest rates further if needed but does not target a specific level for money market rates.


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