Forex - GBP/USD lower as Greece worries weigh

Published 05/08/2012, 04:31 AM
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Investing.com - The pound slipped lower against the U.S. dollar on Tuesday, as ongoing concerns over political uncertainty in Greece weighed after initial attempts to form a coalition government collapsed, following weekend elections.

GBP/USD hit 1.6140 during European morning trade, the session low; the pair subsequently consolidated at 1.6146, shedding 0.27%.

Cable was likely to find support at 1.6080, the low of April 25 and resistance at 1.6198, the session high.

Markets were watching developments in Greece as political leaders continued to hold cross party talks after the country’s largest party, New Democracy, was unable to reach an agreement to form a government on Monday.

The uncertainty fuelled fears that Greece will not have a government in place in time to secure its next tranche of international aid next month, as new elections look increasingly likely.

Investors were also jittery amid concerns over new French president-elect, Socialist Francois Hollande who has said he wants to renegotiate the euro zone’s fiscal pact in order to stimulate growth in the region.

The pound eased back from a three-and-a-half year high against the euro, with EUR/USD inching up 0.09% to hit 0.8066.

Later in the day, Germany was to release official data on industrial production, while European Central Bank President Mario Draghi was due to speak in Frankfurt.

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