Investing.com – The pound erased losses against the U.S. dollar on Tuesday, climbing to a four-day high as market sentiment strengthened amid optimism that European leaders would take decisive action to deal with the financial crisis in the euro zone.
GBP/USD rebounded from 1.5528, the daily low, to hit 1.5617 during European afternoon trade, rising 0.34%.
Cable was likely to find support at 1.5431, Monday’s low and resistance at 1.5746, the high of September 21.
Later in the week, several euro member states, including Germany, were to vote on expanding the role of the euro zone’s bailout fund, the European Financial Stability Facility. The measures have to be passed by all of the currency bloc's governments before steps to expand its role can be implemented.
However, Spain's economy minister said earlier that plans to enlarge the EFSF to EUR2 trillion from its existing EUR4 billion were not on the table.
Meanwhile, expectations mounted that the European Central Bank may cut interest rates to support growth in the euro zone, after an ECB official said Monday that cuts could not be ruled out.
The pound was almost unchanged against the euro, with EUR/GBP dipping 0.01% to hit 0.8692.
Also Tuesday, industry data released earlier showed that retail sales in the U.K. unexpectedly declined in September, falling to the lowest level since May 2010.
The Confederation of British Industry said the result of its index of U.K. retailers fell to minus 15.0 in September from a reading of minus 14.0 in August. Analysts had expected the index to hold steady at minus 14.0.
GBP/USD rebounded from 1.5528, the daily low, to hit 1.5617 during European afternoon trade, rising 0.34%.
Cable was likely to find support at 1.5431, Monday’s low and resistance at 1.5746, the high of September 21.
Later in the week, several euro member states, including Germany, were to vote on expanding the role of the euro zone’s bailout fund, the European Financial Stability Facility. The measures have to be passed by all of the currency bloc's governments before steps to expand its role can be implemented.
However, Spain's economy minister said earlier that plans to enlarge the EFSF to EUR2 trillion from its existing EUR4 billion were not on the table.
Meanwhile, expectations mounted that the European Central Bank may cut interest rates to support growth in the euro zone, after an ECB official said Monday that cuts could not be ruled out.
The pound was almost unchanged against the euro, with EUR/GBP dipping 0.01% to hit 0.8692.
Also Tuesday, industry data released earlier showed that retail sales in the U.K. unexpectedly declined in September, falling to the lowest level since May 2010.
The Confederation of British Industry said the result of its index of U.K. retailers fell to minus 15.0 in September from a reading of minus 14.0 in August. Analysts had expected the index to hold steady at minus 14.0.