Forex - GBP/USD pushes higher after upbeat U.S. data

Published 02/16/2012, 10:21 AM
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Investing.com - The pound extended gains against the U.S. dollar on Thursday, as a flurry of upbeat U.S. economic data supported market sentiment although concerns over Greece’s second bailout package persisted.

GBP/USD hit 1.5728 during U.S. morning trade, the daily high; the pair subsequently consolidated at 1.5724, adding 0.19%.

Cable was likely to find support at 1.5644, the low of February 14 and resistance at 1.5796, the high of January 31.

Sentiment was lifted after official data showed earlier that U.S. unemployment claims fell unexpectedly to their lowest level since March 2008 last week, falling to 348,000, confounding expectations for an increase to 364,000.

In a separate report, the U.S. Census Bureau said the number of building permits issued in January rose 0.7% to a seasonally adjusted 0.68 million, broadly in line with market expectations.

Data also showed that an index of manufacturing activity in the Philadelphia area rose more-than-expected in February, advancing to 10.2, above expectations for a rise to 9.0.

Meanwhile, U.S. core producer price inflation rose more-than-expected in January, ticking up 0.4% after a 0.3% rise the previous month. Analysts had expected core PPI to rise 0.1% in January.

But sterling’s gains were limited as European Union officials are believed to be looking at delaying all or part of Greece's bailout until after a general election in the country, which is expected to take place in April.

Officials are examining the possibility of extending a bridging loan to Athens, which would allow Greece to meet EUR14.4 billion in repayments which come due on March 20, avoiding a default.

Also Thursday, ratings agency Moody's warned that it may cut the credit ratings of 114 banks in 16 countries across Europe, citing banks' vulnerability to the sovereign debt crisis in the euro zone.

Elsewhere, the pound was also higher against the euro with EUR/GBP shedding 0.44%, to hit 0.8289.

In the U.K., the Nationwide Building Society said earlier that its index of consumer confidence for the U.K. improved more-than-expected in January, rising to 47 after a reading at 38 the previous month.


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