Investing.com – Sterling erased early modest gains against the U.S. dollar on Thursday, after a report showing the U.K. services sector contracted unexpectedly in December, marking the first fall in output since April 2009.
GBP/USD retreated from 1.5564, the daily high to hit 1.5481 during European morning trade, shedding 0.2%.
Cable was likely to find support at 1.5418, the low of December 31 and resistance at 1.5627, Wednesday’s high.
The Markit/CIPS services purchasing managers' index dropped to 49.7 in December, in contrast to analysts predictions that it would hold steady at November's reading of 53.0.
Readings below 50 indicate contraction while readings of more than 50 indicate expansion.
Chris Williamson, chief economist at Markit said, "Bad weather undoubtedly hit service-sector business in December, but there are also clear signs that domestic demand has weakened" as households and businesses continue to curtail spending.
Meanwhile, the pound was almost unchanged against the euro, with EUR/GBP dipping 0.02% to hit 0.8473.
Later in the day, the U.S. was to publish official data on initial jobless claims.
GBP/USD retreated from 1.5564, the daily high to hit 1.5481 during European morning trade, shedding 0.2%.
Cable was likely to find support at 1.5418, the low of December 31 and resistance at 1.5627, Wednesday’s high.
The Markit/CIPS services purchasing managers' index dropped to 49.7 in December, in contrast to analysts predictions that it would hold steady at November's reading of 53.0.
Readings below 50 indicate contraction while readings of more than 50 indicate expansion.
Chris Williamson, chief economist at Markit said, "Bad weather undoubtedly hit service-sector business in December, but there are also clear signs that domestic demand has weakened" as households and businesses continue to curtail spending.
Meanwhile, the pound was almost unchanged against the euro, with EUR/GBP dipping 0.02% to hit 0.8473.
Later in the day, the U.S. was to publish official data on initial jobless claims.