Investing.com - The pound rose to session highs against the dollar on Wednesday after data showed that activity in the U.K. services sector expanded at the fastest rate in six-and-a-half years in August.
GBP/USD hit 1.5594 during European morning trade, the session high; the pair subsequently consolidated at 1.5587, gaining 0.18%.
Cable was likely to find support at 1.5553, the session low and resistance at 1.5664, the high of August 22.
Markit said U.K. services purchasing managers’ index rose to 60.5 in August, the highest since December 2006, from 60.2 in July. Economists had forecast a decline to 59.0.
The report said new business grew for the eight successive month and the latest increase was the largest seen in more than 16 years.
“With sister surveys for construction and manufacturing also signaling the continuation of substantial growth, the U.K. is well on course to register a strengthening of GDP growth over Q3 as a whole following the 0.7% increase in Q2” said Paul Smith, senior economist at Markit.
The data bolstered expectations that the Bank of England may have to raise interest rates sooner than it has indicated.
Last month, the BoE pledged to keep rates on hold at record lows until the U.K. unemployment rate falls below 7%, something the bank sees as unlikely to happen for another three years.
The BoE was expected to keep monetary policy unchanged at the outcome of its policy meeting on Thursday.
Sterling’s gains were held in check after upbeat U.S. manufacturing data on Tuesday reinforced expectations that the Federal Reserve could start to phase out stimulus measures as soon as this month.
Concerns over possible U.S. military strikes against Syria continued to weigh on sentiment after top congressional leaders, including Republican House Speaker John Boehner and Democrat Nancy Pelosi said they would back President Obama's call for military intervention.
Elsewhere, the pound was higher against the euro, with EUR/GBP sliding 0.16% to 0.8450.
In the euro zone, data on Wednesday showed that the final reading of Germany’s services PMI came in at 52.8 in August, up from a preliminary reading of 52.4. The euro zone’s services PMI dipped to 50.7, from an initial estimate for 51.0.
GBP/USD hit 1.5594 during European morning trade, the session high; the pair subsequently consolidated at 1.5587, gaining 0.18%.
Cable was likely to find support at 1.5553, the session low and resistance at 1.5664, the high of August 22.
Markit said U.K. services purchasing managers’ index rose to 60.5 in August, the highest since December 2006, from 60.2 in July. Economists had forecast a decline to 59.0.
The report said new business grew for the eight successive month and the latest increase was the largest seen in more than 16 years.
“With sister surveys for construction and manufacturing also signaling the continuation of substantial growth, the U.K. is well on course to register a strengthening of GDP growth over Q3 as a whole following the 0.7% increase in Q2” said Paul Smith, senior economist at Markit.
The data bolstered expectations that the Bank of England may have to raise interest rates sooner than it has indicated.
Last month, the BoE pledged to keep rates on hold at record lows until the U.K. unemployment rate falls below 7%, something the bank sees as unlikely to happen for another three years.
The BoE was expected to keep monetary policy unchanged at the outcome of its policy meeting on Thursday.
Sterling’s gains were held in check after upbeat U.S. manufacturing data on Tuesday reinforced expectations that the Federal Reserve could start to phase out stimulus measures as soon as this month.
Concerns over possible U.S. military strikes against Syria continued to weigh on sentiment after top congressional leaders, including Republican House Speaker John Boehner and Democrat Nancy Pelosi said they would back President Obama's call for military intervention.
Elsewhere, the pound was higher against the euro, with EUR/GBP sliding 0.16% to 0.8450.
In the euro zone, data on Wednesday showed that the final reading of Germany’s services PMI came in at 52.8 in August, up from a preliminary reading of 52.4. The euro zone’s services PMI dipped to 50.7, from an initial estimate for 51.0.