Forex - GBP/USD holds steady in cautious trade

Published 11/13/2012, 10:30 AM
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 markets were jittery amid uncertainty over whether Greece will soon receive its next tranche of financial aid, while concerns over U.S. fiscal policy persisted.

GBP/USD hit 1.5916 during U.S. morning trade, the session high; the pair subsequently consolidated at 1.5886, easing up 0.05%.

Cable was likely to find support at 1.5826, the low of September 5 and resistance at 1.6034, the high of September 7.

German newspaper Bild reported earlier that Greece is to receive EUR44 billion of financial aid in one payment, citing German government sources.

On Monday, euro zone finance ministers and the International Monetary Fund on Monday failed to agree on a long-term plan to reduce Greece's debt, preventing the disbursement of immediate aid to Athens.

But sentiment remained under pressure after the ZEW Centre for Economic Research said that its index of German economic sentiment fell to minus 15.7 in November from October’s reading of minus 11.5. Analysts had expected the index come in at minus 9.8 this month.

The report said that "recessionary developments" in the euro zone are expected to curtail German economic growth in the next six months.

Meanwhile, ongoing concerns over the U.S. fiscal cliff continued to underpin demand for the greenback.

Sterling was higher against the euro with EUR/GBP falling 0.12%, to hit 0.8188.

Also Tuesday, official data showed that U.K. consumer prices rose sharply in October, as a result of increases in the cost of food, transport and university fees.

The Office for National Statistics said the annual rate of consumer price inflation accelerated to 2.7% in October from 2.2% in September and a five month high.


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