Investing.com - The pound remained moderately higher against the U.S. dollar on Tuesday, as market sentiment found broad support amid specultion over a 'soft' bailout for Spain, but gains were limited as the perspective of more easing by the Bank of England weighed.
GBP/USD hit 1.6132, the pair's highest since October 8; the pair subsequently consolidated at 1.3036, adding 0.19%.
Cable was likely to find support at 1.6022, Monday's low and resistance at 1.6158, the high of September 30.
Sentiment broadly strengthened after two senior German lawmakers indicated that they would support a Spanish application for a ‘precautionary credit line’ from the European Stability Mechanism, the euro zone's permanent bailout fund.
However, Michael Meister, a deputy caucus leader of Chancellor Angela Merkel’s Christian Democratic Party denied referring to Spain in his comments, which he said were “over-interpreted”.
But sterling remained under pressure, after U.K. data showing a slowdown in consumer inflation last month left the BoE leeway to ease monetary policy further.
The Office for National Statistics said that the annualized rate of consumer price inflation dropped to 2.2% in September, the lowest since November 2009, down from 2.5% in August.
In the U.S., the Labor Department earlier said that consumer prices rose by 0.6% in September, above expectations for a 0.5% gain on the back of higher gasoline prices.
Consumer prices rose at an annualized rate of 2.0% last month, compared to expectations for a 1.9% increase and up from 1.7% in August.
Elsewhere, the pound was lower against the euro with EUR/GBP climbing 0.47%, to hit 0.8096.
Also Tuesday, the ZEW Centre said that its closely watched index of German economic sentiment improved to minus 11.5 in October from September’s reading of minus 18.2. Economists had forecast a reading of minus 15.0 this month.
GBP/USD hit 1.6132, the pair's highest since October 8; the pair subsequently consolidated at 1.3036, adding 0.19%.
Cable was likely to find support at 1.6022, Monday's low and resistance at 1.6158, the high of September 30.
Sentiment broadly strengthened after two senior German lawmakers indicated that they would support a Spanish application for a ‘precautionary credit line’ from the European Stability Mechanism, the euro zone's permanent bailout fund.
However, Michael Meister, a deputy caucus leader of Chancellor Angela Merkel’s Christian Democratic Party denied referring to Spain in his comments, which he said were “over-interpreted”.
But sterling remained under pressure, after U.K. data showing a slowdown in consumer inflation last month left the BoE leeway to ease monetary policy further.
The Office for National Statistics said that the annualized rate of consumer price inflation dropped to 2.2% in September, the lowest since November 2009, down from 2.5% in August.
In the U.S., the Labor Department earlier said that consumer prices rose by 0.6% in September, above expectations for a 0.5% gain on the back of higher gasoline prices.
Consumer prices rose at an annualized rate of 2.0% last month, compared to expectations for a 1.9% increase and up from 1.7% in August.
Elsewhere, the pound was lower against the euro with EUR/GBP climbing 0.47%, to hit 0.8096.
Also Tuesday, the ZEW Centre said that its closely watched index of German economic sentiment improved to minus 11.5 in October from September’s reading of minus 18.2. Economists had forecast a reading of minus 15.0 this month.