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

Published 09/26/2011, 11:00 AM
GBP/USD
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EUR/GBP
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Investing.com - The pound held gains against the U.S. dollar on Monday, trading close to a three-day high after U.S. government data showed that new homes sales fell less-than-expected last month.

GBP/USD hit 1.5554 during U.S. morning trade, the pair's highest since September 2; the pair subsequently consolidated at 1.5531, climbing 0.65%.

The pair was likely to find support at 1.5330, the low of September 23 and resistance at 1.5639, the high of January 11.

Earlier in the day, official data showed that U.S. new home sales fell less-than-expected in August, falling 2.3% to 295K, from an upwardly revised 302K the previous month.

Analysts had expected new home sales to fall to 293K in August.

The pound dipped against the greenback earlier after Bank of England policymaker Ben Broadbent said sterling was likely to remain weak for some time and that the slowdown in global growth would weigh on inflation.

The remarks came after last week’s minutes of the central bank’s September meeting indicated that policymakers are leaning towards implementing more monetary easing to boost the U.K. economy, possibly as early as next month.

Meanwhile, the pound was up against the euro with EUR/GBP tumbling 0.76%, to trade at 0.8671.

Also Monday, speculation over rate cuts by the European Central Bank continued after a senior ECB policymaker said the possibility could not be excluded.

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