Investing.com - The pound remained near eight-month highs against the U.S. dollar on Monday, as risk sentiment was supported by news that former U.S. Treasury Secretary Lawrence Summers withdrew from the running to be the next chairman of the Federal Reserve.
GBP/USD hit 1.5963 during U.S. morning trade, the the highest since January 18; the pair subsequently consolidated at 1.5945, gaining 0.41%.
Cable was likely to find support at 1.5850 and resistance at 1.6003, the high of January 18.
Investor confidence was boosted after Summers pulled out of the race to succeed Ben Bernanke as the next Fed chairman. Summers’ was perceived as being likely to unwind economic stimulus measures more aggressively than his main rival for the post, Janet Yellen.
Market participants were also awaiting the outcome of the upcoming Fed policy meeting, which concludes on Wednesday.
Separately, data showed that the Empire State manufacturing index fell to a four-month low of 6.29 in September from a reading of 8.24 in August. Analysts had expected the index to rise to 9.2.
The report added to doubts over whether the Fed will decide to start unwinding its USD85 billion-a-month bond buying program this month.
Data also showed that U.S. industrial production rose 0.4% in August, in line with expectations, after a flat reading the previous month.
Sterling was fractionally lower against the euro with EUR/GBP edging up 0.08%, to hit 0.8380.
Also Monday, European Central Bank President Mario Draghi said Monday that the economic recovery in the euro zone remains “fragile” and reiterated that interest rates will remain at current or lower levels for an “extended period”. The comments came during a speech in Berlin.
Separately, data showed that consumer price inflation in the euro zone remained steady at 1.3% on a year-over-year basis in August, unchanged from an initial estimate and in line with expectations.
GBP/USD hit 1.5963 during U.S. morning trade, the the highest since January 18; the pair subsequently consolidated at 1.5945, gaining 0.41%.
Cable was likely to find support at 1.5850 and resistance at 1.6003, the high of January 18.
Investor confidence was boosted after Summers pulled out of the race to succeed Ben Bernanke as the next Fed chairman. Summers’ was perceived as being likely to unwind economic stimulus measures more aggressively than his main rival for the post, Janet Yellen.
Market participants were also awaiting the outcome of the upcoming Fed policy meeting, which concludes on Wednesday.
Separately, data showed that the Empire State manufacturing index fell to a four-month low of 6.29 in September from a reading of 8.24 in August. Analysts had expected the index to rise to 9.2.
The report added to doubts over whether the Fed will decide to start unwinding its USD85 billion-a-month bond buying program this month.
Data also showed that U.S. industrial production rose 0.4% in August, in line with expectations, after a flat reading the previous month.
Sterling was fractionally lower against the euro with EUR/GBP edging up 0.08%, to hit 0.8380.
Also Monday, European Central Bank President Mario Draghi said Monday that the economic recovery in the euro zone remains “fragile” and reiterated that interest rates will remain at current or lower levels for an “extended period”. The comments came during a speech in Berlin.
Separately, data showed that consumer price inflation in the euro zone remained steady at 1.3% on a year-over-year basis in August, unchanged from an initial estimate and in line with expectations.