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Forex - GBP/USD higher as U.K. services data on tap

Published 04/05/2011, 04:09 AM
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Investing.com – The pound was higher against the U.S. dollar on Tuesday, but gains were limited ahead of a report on activity in the U.K.’s service industries sector later in the day.

GBP/USD hit 1.6165 during European morning trade, the daily high; the pair subsequently consolidated at 1.6157, gaining 0.15%.

The pair was likely to find support at 1.5970, last Friday’s low and short-term resistance at 1.6176, Monday’s high and a seven-day high.

Earlier in the day, the British Chamber of Commerce said the first-quarter rebound in the U.K.’s economy was weaker than expected, adding to the argument that the Bank of England should delay raising its key interest rate.

The BCC said gross domestic product probably grew between 0.6% and 0.7% from the fourth quarter, when the economy contracted 0.5%.

The BCC’s Chief Economist David Kern said the figures, “don’t point to a new recession, they point to continued growth, but the recovery is fragile and they certainly provide support for the view that the Monetary Policy Committee should not rush” tightening policy.

The pound was also higher against the euro, with EUR/GBP shedding 0.38% to hit 0.8781.

Later Tuesday, the U.S. was to publish data on service sector growth while the Federal Reserve was to publish the minutes of its most recent policy setting meeting.

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