Investing.com - The pound trimmed gains against the dollar on Tuesday after data showed that U.K. consumer prices dipped in August, while investors looked ahead to this week’s early awaited Federal Reserve policy announcement.
GBP/USD pulled away from 1.5936, the session high, to hit 1.5908 during European afternoon trade, up just 0.07% for the day.
Cable was likely to find support at 1.5850 and resistance at 1.5962, Monday’s high and the highest since January.
The Office for National Statistics said U.K. consumer price inflation ticked down to 2.7% on a year-over-year basis in August from 2.8% in July, in line with economists’ forecasts.
Core CPI remained unchanged at 2% last month, compared to expectations for an uptick to 2.1%.
Consumer prices rose by 0.4% on the month in August, compared to expectations for a 0.5% increase.
The dollar remained under pressure ahead of the outcome of the Fed’s two-day policy meeting on Wednesday, amid expectations for a small reduction to the bank’s USD85 billion-a-month stimulus program.
The dollar weakened broadly on Monday after former U.S. Treasury Secretary Lawrence Summers withdrew from the contest to succeed Ben Bernanke as the next chairman of the U.S. central bank.
Summers’ was perceived as being likely to unwind economic stimulus measures more aggressively than the other main contender for the post, Janet Yellen.
Sterling was slightly lower against the euro, with EUR/GBP rising 0.12% to 0.8396.
The single currency found support after a report showed that the closely watched ZEW index of German economic sentiment rose to the highest level since April 2010 in September.
The ZEW index of German economic sentiment rose to 49.6 in September from 42.0 last month, on the back of the improved economic outlook for the euro zone. Analysts had forecast a reading of 46.0.
The U.S. was to release data on consumer prices later in the trading day.
GBP/USD pulled away from 1.5936, the session high, to hit 1.5908 during European afternoon trade, up just 0.07% for the day.
Cable was likely to find support at 1.5850 and resistance at 1.5962, Monday’s high and the highest since January.
The Office for National Statistics said U.K. consumer price inflation ticked down to 2.7% on a year-over-year basis in August from 2.8% in July, in line with economists’ forecasts.
Core CPI remained unchanged at 2% last month, compared to expectations for an uptick to 2.1%.
Consumer prices rose by 0.4% on the month in August, compared to expectations for a 0.5% increase.
The dollar remained under pressure ahead of the outcome of the Fed’s two-day policy meeting on Wednesday, amid expectations for a small reduction to the bank’s USD85 billion-a-month stimulus program.
The dollar weakened broadly on Monday after former U.S. Treasury Secretary Lawrence Summers withdrew from the contest to succeed Ben Bernanke as the next chairman of the U.S. central bank.
Summers’ was perceived as being likely to unwind economic stimulus measures more aggressively than the other main contender for the post, Janet Yellen.
Sterling was slightly lower against the euro, with EUR/GBP rising 0.12% to 0.8396.
The single currency found support after a report showed that the closely watched ZEW index of German economic sentiment rose to the highest level since April 2010 in September.
The ZEW index of German economic sentiment rose to 49.6 in September from 42.0 last month, on the back of the improved economic outlook for the euro zone. Analysts had forecast a reading of 46.0.
The U.S. was to release data on consumer prices later in the trading day.