Forex - GBP/USD holds gains, U.K. data supports

Published 10/30/2012, 11:31 AM
Updated 10/30/2012, 11:32 AM
GBP/USD
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EUR/GBP
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Investing.com - The pound held gains against the U.S. dollar in light trade on Tuesday, while data showing that U.K. retail sales rose to a four-month high in October continued to support demand for sterling, while U.S. markets remained closed for a second day as a result of Hurricane Sandy.

GBP/USD hit 1.6085 during U.S. morning trade, the session high; the pair subsequently consolidated at 1.6081, rising 0.29%.

Cable was likely to find support at 1.6007, Monday's low and resistance at 1.6144, the high of October 25.

The Confederation of British Industry’s distributive trades survey showed that the sales balance jumped to 30 from 6 in September. Analysts had forecast a reading of 7.

The upbeat data diminished expectations for further easing measures by the Bank of England.

Market sentiment found some support after the initial damage caused by Hurricane Sandy appeared to have been less severe that some had feared.

Meanwhile, in the euro zone Italy saw borrowing costs fall to the lowest level since May 2011 at an auction of five- and ten-year government bonds.

Elsewhere, official data showed that the Spanish economy contracted by 0.3% in the third quarter, below expectations for a 0.4% contraction, extending the country’s recession into a fourth quarter.

Elsewhere, the pound was lower against the euro with EUR/GBP adding 0.30%, to hit 0.8072.

In the U.S., a report by Standard & Poor’s with Case-Shiller said its house price index rose at an annualized rate of 2.0% in August from a year earlier, slightly better than expectations for a 1.9% increase.


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