Investing.com - The pound trimmed gains against the U.S. dollar on Wednesday, as market sentiment was dented after ratings agency Fitch’s flagged a possible two-notch downgrade for Italy.
GBP/USD pulled back from 1.5378, the daily high to hit 1.5342 during early European trade, still up 0.06%.
Cable was likely to find support at 1.5278, the low of January 12 and resistance at 1.5404, Tuesday’s high.
Sentiment came under pressure after Fitch ratings agency said earlier it may downgrade Italy’s credit rate by two notches.
Italy currently holds an A+ rating, but last month, along with Spain, Belgium, the Irish Republic, Slovenia and Cyprus, it was placed on "credit watch negative" by Fitch’s, which means it could face a downgrade within three months.
The announcement came after Standard & Poor’s downgraded nine euro zone countries, including Italy, as well as the euro zone’s bailout fund, the European Financial Stability Facility.
Meanwhile, Greece’s government was due to resume talks with its bond holders to discuss a voluntary write-down on Greece’s sovereign debt, after talks broke down on Friday, amid disagreements over how much money investors will lose by swapping their bonds.
Greece needs to secure an agreement on restructuring its debt in order to access new bailout funds and avert a default when an EUR14.4 billion bond redemption comes due on March 20.
Sterling was also steady against the euro with EUR/GBP rising 0.10%, to hit 0.8315.
Later in the day, the U.K. was to release official data on claimant count change, as well as a report on the employment rate.
In the U.S., official data was to be released on producer price inflation and industrial production.
GBP/USD pulled back from 1.5378, the daily high to hit 1.5342 during early European trade, still up 0.06%.
Cable was likely to find support at 1.5278, the low of January 12 and resistance at 1.5404, Tuesday’s high.
Sentiment came under pressure after Fitch ratings agency said earlier it may downgrade Italy’s credit rate by two notches.
Italy currently holds an A+ rating, but last month, along with Spain, Belgium, the Irish Republic, Slovenia and Cyprus, it was placed on "credit watch negative" by Fitch’s, which means it could face a downgrade within three months.
The announcement came after Standard & Poor’s downgraded nine euro zone countries, including Italy, as well as the euro zone’s bailout fund, the European Financial Stability Facility.
Meanwhile, Greece’s government was due to resume talks with its bond holders to discuss a voluntary write-down on Greece’s sovereign debt, after talks broke down on Friday, amid disagreements over how much money investors will lose by swapping their bonds.
Greece needs to secure an agreement on restructuring its debt in order to access new bailout funds and avert a default when an EUR14.4 billion bond redemption comes due on March 20.
Sterling was also steady against the euro with EUR/GBP rising 0.10%, to hit 0.8315.
Later in the day, the U.K. was to release official data on claimant count change, as well as a report on the employment rate.
In the U.S., official data was to be released on producer price inflation and industrial production.