Investing.com - The pound hit fresh three-week lows against the U.S. dollar on Tuesday, as data showing that the annual rate of inflation in the U.K. fell to a four year low in November still weighed on demand for sterling.
GBP/USD hit 1.6220 during U.S. morning trade, the pair's lowest since November 27; the pair subsequently consolidated at 1.6233, sliding 0.43%.
Cable was likely to find support at 1.6198, the low of November 27 and resistance at 1.6360, the high of December 13.
The Office for National Statistics earlier said the annual rate of consumer price inflation in the U.K. rose by 2.1% in November, slowing from 2.2% the previous month. It was the smallest increase since November 2009. Economists had expected an unchanged reading.
Consumer prices rose 0.1% in November from a month earlier, below expectations for a 0.2% increase.
Core CPI rose by 1.8% last month, in line with expectations, accelerating from 1.7% in October.
The retail price index rose 2.6% in November, unchanged from October and below forecasts for a 2.7% increase.
The data also showed that the house prices index climbed 5.5% in the twelve months to October, above expectations for a 4.2% gain. It was the fastest increase since September 2010.
In the U.S., the Department of Labor said consumer prices were flat in November after falling 0.1% in October.
The annual rate of inflation rose 1.2% last month, undershooting expectations for an increase of 1.3%, but was up from a four year low of 1.0% in October.
Market sentiment remained subdued ahead of the outcome of the Federal Reserve’s two-day policy meeting on Wednesday, amid ongoing uncertainty over when the bank will announce a reduction in the pace of its USD85 billion-a-month asset purchase program.
Sterling was lower against the euro, with EUR/GBP edging up 0.19% to 0.8459.
In the euro zone, a report earlier showed that the ZEW index of German economic sentiment rose to 62.0 in December from November’s reading of 54.6. It was the highest level since April 2006. Economists had expected the index to tick up to 55.0 this month.
The data came one day after a report showed that manufacturing activity in Germany rose to a 30 month high in November, bolstering the outlook for the recovery in the euro zone.
GBP/USD hit 1.6220 during U.S. morning trade, the pair's lowest since November 27; the pair subsequently consolidated at 1.6233, sliding 0.43%.
Cable was likely to find support at 1.6198, the low of November 27 and resistance at 1.6360, the high of December 13.
The Office for National Statistics earlier said the annual rate of consumer price inflation in the U.K. rose by 2.1% in November, slowing from 2.2% the previous month. It was the smallest increase since November 2009. Economists had expected an unchanged reading.
Consumer prices rose 0.1% in November from a month earlier, below expectations for a 0.2% increase.
Core CPI rose by 1.8% last month, in line with expectations, accelerating from 1.7% in October.
The retail price index rose 2.6% in November, unchanged from October and below forecasts for a 2.7% increase.
The data also showed that the house prices index climbed 5.5% in the twelve months to October, above expectations for a 4.2% gain. It was the fastest increase since September 2010.
In the U.S., the Department of Labor said consumer prices were flat in November after falling 0.1% in October.
The annual rate of inflation rose 1.2% last month, undershooting expectations for an increase of 1.3%, but was up from a four year low of 1.0% in October.
Market sentiment remained subdued ahead of the outcome of the Federal Reserve’s two-day policy meeting on Wednesday, amid ongoing uncertainty over when the bank will announce a reduction in the pace of its USD85 billion-a-month asset purchase program.
Sterling was lower against the euro, with EUR/GBP edging up 0.19% to 0.8459.
In the euro zone, a report earlier showed that the ZEW index of German economic sentiment rose to 62.0 in December from November’s reading of 54.6. It was the highest level since April 2006. Economists had expected the index to tick up to 55.0 this month.
The data came one day after a report showed that manufacturing activity in Germany rose to a 30 month high in November, bolstering the outlook for the recovery in the euro zone.