Investing.com - The pound rose against the dollar on Thursday after U.K. retail sales numbers beat expectations, though an upbeat regional U.S. manufacturing barometer steadied the greenback, sending the pair dipping into negative territory at times.
In U.S. trading on Thursday, GBP/USD was up 0.05% at 1.5689, up from a session low of 1.5632 and off a high of 1.5736.
Cable was likely to find support at 1.5588, Wednesday's low, and resistance at 1.5737, Monday's high.
The U.K. Office for National Statistics reported earlier that retail sales increased 0.8% last month, beating forecasts for a 0.4% gain. September retail sales fell by 0.4%.
Year-on-year, retail sales rose at a rate of 4.3% in October, topping expectations for a 3.8% gain, after rising at a rate of 2.3% in September.
Core retail sales, which exclude automobile sales, increased by 0.8% last month, also outpacing forecasts for a 0.3% rise, after falling 0.3% the previous month.
Meanwhile in the U.S., manufacturing activity in the Philadelphia-region expanded at its fastest rate since December 1993 in November, fueling optimism over the U.S. economy, official data showed on Thursday.
The Federal Reserve Bank of Philadelphia reported earlier that its manufacturing index improved to 40.8 this month from 20.7 in October.
Analysts had expected the index to decline to 18.5 in September, and the surprise jumped cushioned the U.S. currency's losses against the pound.
On the index, a reading above 0.0 indicates improving conditions, below indicates worsening conditions.
The current new orders index, which reflects the demand for manufactured goods, increased 18 points, to 35.7.
The current employment index rose 10 points in November, to 22.4, and hit a 3½ year high.
Upbeat U.S. inflation data also supported the dollar by firming expectations that the Fed remains on track to raise interest rates next year.
The Labor Department reported earlier that the U.S. consumer price index was unchanged in October, beating expectations for a 0.1% dip.
On a year-over-year basis consumer prices rose 1.7% last month, unchanged from September, and stronger than market calls for a 1.6% jump.
Core inflation, which strips out volatile food and energy components, rose by 0.2% during the month, pushing the annual rate up to 1.8%, both figures in line with market forecasts.
Also from the Labor Department, data released earlier revealed that the number of Americans filing new claims for unemployment benefit fell by 2,000 last week, to 291,000. Economists had expected a fall to 286,000, thought it was still the tenth straight week that initial claims remained below 300,000.
The number of continuing claims also fell, to 2.33 million, the lowest level since December 2000.
Elsewhere, sterling was up against the euro, with EUR/GBP down 0.22% at 0.7987, and up against the yen, with GBP/JPY up 0.19% at 185.30.
On Friday, the U.K. is to release data on public sector borrowing.