Investing.com - The pound remained near one-and-a-half week highs against the U.S. dollar on Wednesday, as data showing that activity in the U.K. services sector expanded at the fastest rate in six-and-a-half years in August continued to support demand for sterling.
GBP/USD hit 1.5632 during U.S. morning trade, the pair's highest since August 23; the pair subsequently consolidated at 1.5604, rising 0.28%.
Cable was likely to find support at 1.5506, the low of September 2 and resistance at 1.5718, the high of August 21 and a two-month high.
Sterling strengthened against the dollar after Markit said U.K. services purchasing managers’ index rose to 60.5 in August, the highest since December 2006, from 60.2 in July. Economists had forecast a decline to 59.0.
The report said new business grew for the eight successive month and the latest increase was the largest seen in more than 16 years.
The data bolstered expectations that the Bank of England may have to raise interest rates sooner than it has indicated.
Last month, the BoE pledged to keep rates on hold at record lows until the U.K. unemployment rate falls below 7%, something the bank sees as unlikely to happen for another three years.
The BoE was expected to keep monetary policy unchanged at the outcome of its policy meeting on Thursday.
In the U.S., official data showed that the trade deficit widened more-than-expected in July, falling to USD39.2 billion from a downwardly revised USD34.5 billion deficit the previous month. Analysts had expected the trade deficit to widen to USD38.7 billion in July.
The report came as investors continued to speculate over the timing of the Fed's widely expected reduction in monthly bond purchases after data on Tuesday showed that manufacturing activity in the U.S. expanded at the fastest rate since April 2011 in August.
Investors were now looking ahead to Friday’s highly-anticipated U.S. nonfarm payrolls report which is seen as key to the Fed’s decision on tapering.
Meanwhile, investors remained cautious after top congressional leaders, including Republican House Speaker John Boehner and Democrat Nancy Pelosi said they would back President Obama's call for military intervention in Syria.
Sterling was also higher against the euro with EUR/GBP shedding 0.30%, to hit 0.8439.
In the euro zone, data earlier showed that the final reading of Germany’s services purchasing managers' index came in at 52.8 in August, up from a preliminary reading of 52.4. The euro zone’s services PMI dipped to 50.7, from an initial estimate for 51.0.
GBP/USD hit 1.5632 during U.S. morning trade, the pair's highest since August 23; the pair subsequently consolidated at 1.5604, rising 0.28%.
Cable was likely to find support at 1.5506, the low of September 2 and resistance at 1.5718, the high of August 21 and a two-month high.
Sterling strengthened against the dollar after Markit said U.K. services purchasing managers’ index rose to 60.5 in August, the highest since December 2006, from 60.2 in July. Economists had forecast a decline to 59.0.
The report said new business grew for the eight successive month and the latest increase was the largest seen in more than 16 years.
The data bolstered expectations that the Bank of England may have to raise interest rates sooner than it has indicated.
Last month, the BoE pledged to keep rates on hold at record lows until the U.K. unemployment rate falls below 7%, something the bank sees as unlikely to happen for another three years.
The BoE was expected to keep monetary policy unchanged at the outcome of its policy meeting on Thursday.
In the U.S., official data showed that the trade deficit widened more-than-expected in July, falling to USD39.2 billion from a downwardly revised USD34.5 billion deficit the previous month. Analysts had expected the trade deficit to widen to USD38.7 billion in July.
The report came as investors continued to speculate over the timing of the Fed's widely expected reduction in monthly bond purchases after data on Tuesday showed that manufacturing activity in the U.S. expanded at the fastest rate since April 2011 in August.
Investors were now looking ahead to Friday’s highly-anticipated U.S. nonfarm payrolls report which is seen as key to the Fed’s decision on tapering.
Meanwhile, investors remained cautious after top congressional leaders, including Republican House Speaker John Boehner and Democrat Nancy Pelosi said they would back President Obama's call for military intervention in Syria.
Sterling was also higher against the euro with EUR/GBP shedding 0.30%, to hit 0.8439.
In the euro zone, data earlier showed that the final reading of Germany’s services purchasing managers' index came in at 52.8 in August, up from a preliminary reading of 52.4. The euro zone’s services PMI dipped to 50.7, from an initial estimate for 51.0.