Investing.com – The pound extended gains against the broadly weaker U.S. dollar on Thursday, to trade just below a seven-week high as market sentiment was boosted after European leaders reached an agreement on a deal to contain the debt crisis in the region.
GBP/USD hit 1.6035 during European afternoon trade, the daily high; the pair subsequently consolidated at 1.6025, gaining 0.31%.
Cable was likely to find support at 1.5899, Monday’s low and resistance at 1.6166, the high of September 8.
At a critical summit on Wednesday, European leaders and banks reached a deal on a 50% writedown for private bondholders on their Greek debt, which will reduce Greece’s debt burden from 160% of GDP to 120% by 2020.
Leaders also agreed to expand the firepower of the euro zone's bailout fund, the European Financial Stability Facility, but the final details on how to enlarge the fund were not expected to be agreed until November.
However, the pound remained vulnerable after the Bank of England implemented a second round of monetary easing earlier this month, amid concerns over weakening economic conditions in the U.K.
Earlier Thursday, the Confederation of British Industry said the decline in retail sales in the U.K. moderated in October and retailers expected to see “modest growth” next month, in the build-up to Christmas.
The CBI’s sales balance index rose to minus 11 from the previous month’s reading of minus15. Analysts had expected the index to remain unchanged.
Meanwhile, the pound was down against the euro, with EUR/GBP rising 0.66% to hit 0.8762.
Later in the day, the U.S. was to publish preliminary data on third quarter GDP, as well as the GDP price index, the broadest measure of inflation. The country was also to publish its weekly data on initial jobless claims.
GBP/USD hit 1.6035 during European afternoon trade, the daily high; the pair subsequently consolidated at 1.6025, gaining 0.31%.
Cable was likely to find support at 1.5899, Monday’s low and resistance at 1.6166, the high of September 8.
At a critical summit on Wednesday, European leaders and banks reached a deal on a 50% writedown for private bondholders on their Greek debt, which will reduce Greece’s debt burden from 160% of GDP to 120% by 2020.
Leaders also agreed to expand the firepower of the euro zone's bailout fund, the European Financial Stability Facility, but the final details on how to enlarge the fund were not expected to be agreed until November.
However, the pound remained vulnerable after the Bank of England implemented a second round of monetary easing earlier this month, amid concerns over weakening economic conditions in the U.K.
Earlier Thursday, the Confederation of British Industry said the decline in retail sales in the U.K. moderated in October and retailers expected to see “modest growth” next month, in the build-up to Christmas.
The CBI’s sales balance index rose to minus 11 from the previous month’s reading of minus15. Analysts had expected the index to remain unchanged.
Meanwhile, the pound was down against the euro, with EUR/GBP rising 0.66% to hit 0.8762.
Later in the day, the U.S. was to publish preliminary data on third quarter GDP, as well as the GDP price index, the broadest measure of inflation. The country was also to publish its weekly data on initial jobless claims.