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Forex - GBP/USD slides to nearly 18-month lows in quiet trade

Published 01/12/2015, 05:01 AM
Pound slides lower vs. broadly stronger dollar
GBP/USD
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EUR/GBP
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Investing.com - The pound slid to nearly 18-month lows against the U.S. dollar in quiet trade on Monday, as demand for the greenback remained broadly supported despite Friday's downbeat U.S. average earnings data.

GBP/USD hit 1.5099 during European morning trade, the session low; the pair subsequently consolidated at 1.5120, shedding 0.25%.

Cable was likely to find support at 1.5032, the low of January 8 and an 18-month low and resistance at 1.5337, the high of January 5.

The Labor Department reported on Friday that the economy added 252,000 jobs in December, more than the 240,000 forecast by economists. The unemployment rate ticked down to a six-and-a-half year low 5.6%.

However, average earnings fell by 0.2% last month and were up by only 1.7% from a year earlier.

Weakness in earnings prompted investors to take profits in the dollar, as markets pushed back expectations for the first hike in U.S. interest rates to late-2015.

The pound had found some support on Friday, after the U.K. Office for National Statistics said that manufacturing production rose 0.7% in November, beating expectations for a 0.3% gain.

A separate report showed that the U.K. trade deficit narrowed to £8.85 billion in November from £9.84 billon in October.

Sterling was steady against the euro, with EUR/GBP at 0.7813.

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