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Forex - GBP/USD holds gains after mixed U.S. data

Published 07/26/2012, 10:26 AM
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Investing.com - The pound held gains against the U.S. dollar on Thursday, as mixed U.S. data fueled speculation that the Federal Reserve may implement further easing measures, while comments by European Central bank President Mario Draghi supported risk sentiment.

GBP/USD hit 1.5713 during U.S. morning trade, the pair’s highest since July 20; the pair subsequently consolidated at 1.5709, rallying 1.36%.

Cable was likely to find support at 1.5471, the session low and resistance at 1.5776, the high of June 20.

The U.S. National Association of Realtors said its pending home sales index fell by 1.2% in June, disappointing expectations for a 0.2% increase. Pending home sales for May were revised down to a 5.4% increase from a previously reported gain of 5.9%.

The data came after the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending July 21 fell by 35,000 to a seasonally adjusted 353,000, compared to expectations for a decline of 8,000 to 380,000.

The previous week’s figure was revised up to 388,000 from a previously reported 386,000.

Separately, official data showed that U.S. durable goods orders rose 1.6%, beating expectations for a 0.4% increase and following a 1.6% rise in May.

The report also showed that core durable goods orders, which exclude transportation items, fell unexpectedly in June, declining 1.1% after a 0.8% rise the previous month.

The pound surged to a four-day high against the greenback earlier, after ECB President Draghi pledged to do everything in his mandate to save the euro.

In a speech in London, Draghi also appeared to indicate that the ECB would be prepared to intervene to lower Spanish and Italian bond yields, saying that government borrowing costs would fall within the central bank’s mandate if they interfered with the 'transmission' of monetary policy.

Elsewhere, the pound was higher against the euro with EUR/GBP falling 0.11%, to hit 0.7835.

Later in the day, European Commission President José Manuel Barroso was to hold talks with talks with Greek Prime Minister Antonis Samaras, amid concerns that the country’s economic reform program is off schedule.


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