Forex - GBP/USD remains lower after U.S. reports

Published 09/20/2012, 10:25 AM
Updated 09/20/2012, 10:26 AM
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Investing.com - The pound remained lower against the U.S. dollar on Thursday, following the release of weak U.S. economic reports, as global growth concerns continued to weigh on risk sentiment.

GBP/USD hit 1.6164 during U.S. morning trade, the pair's lowest since September 14; the pair subsequently consolidated at 1.6175, shedding 0.28%.

Cable was likely to find support at 1.6077, the low of September 13 and resistance at 1.6271, Wednesday's high.

Official data showed that manufacturing activity in the Philadelphia-region improved more-than-expected in September, but remained in contraction territory for the fifth consecutive month.

The Federal Reserve Bank of Philadelphia said that its manufacturing index improved to minus 1.9 in September from August’s reading of minus 7.1. Analysts had expected the index to improve to a reading of minus 4.0 in September.

The data came after the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending September 15 fell to a seasonally adjusted 382,000, compared to expectations for a decrease to 375,000.

The previous week’s figure was revised up to 385,000 from a previously reported 382,000.

Market sentiment had weakened earlier, after preliminary data showed that the euro zone’s manufacturing purchasing manufacturers' index rose more-than-expected in September, while service sector activity fell unexpectedly.

A separate report showed that manufacturing activity in Germany contracted at the slowest rate in six months in September, while service sector activity grew modestly.

Earlier in the day, data showed that China’s HSBC Flash Purchasing Managers Index remained in contraction territory for the 11th consecutive month, adding to fears over a further slowdown in the region’s largest economy.

Elsewhere, sterling was higher against the euro with EUR/GBP dropping 0.58%, to hit 0.7997.

Also Thursday, official data showed that U.K. retail sales fell by a seasonally adjusted 0.2% in August, compared to expectations for a 0.4% decline. Retail sales rose by 0.3% in July.

Retail sales rose at an annualized rate of 2.7% in August, in line with expectations, after rising at a rate of 2.3% in the preceding month.


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