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Forex - GBP/USD holds steady after positive U.S. data

Published 06/03/2014, 10:20 AM
Pound little changed vs. greenback after factory orders
GBP/USD
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EUR/GBP
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Investing.com - The pound held steady against the U.S. dollar on Tuesday, as positive U.S. factory orders data boosted the greenback, while an earlier report on construction activity in the U.K. still supported demand for sterling.

GBP/USD hit 1.6782 during U.S. morning trade, the pair's highest since May 28; the pair subsequently consolidated at 1.6749, inching up 0.01%.

Cable was likely to find support at 1.6693, the low of May 29 and resistance at 1.6816, the high of May 28.

The dollar found some support after official data showed that U.S. factory orders rose 0.7% in April, beating expectations for a 0.5% gain, after an upwardly revised 1.5% increase in March.

In the U.K., Markit research group earlier said the construction purchasing managers' index ticked down to 60.0 in May, from a reading of 60.8 the previous month. Analysts had expected the index to remain unchanged last month.

The report came a day after Markit said the U.K. manufacturing PMI fell to 57.0 this month, from a reading of 57.3 in May, in line with expectations.

Sterling was lower against the euro, with EUR/GBP rising 0.23% to 0.8138.

Also Tuesday, data showed that the unemployment rate in the euro zone ticked down to 11.7% in April, from 11.8% the previous month, confounding expectations for the rate to remain unchanged.

Separately, Eurostat said consumer price inflation in the euro zone increased by 0.5% last month, down from 0.7% in April and missing expectations for a reading of 0.7%. The rate stands well below the European Central Bank's target of near but just under 2%.

Data also showed that the number of unemployed people in Spain dropped by 111,900 last month, compared to expectations for a 112,300 decline, after a 111,600 fall in April.

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