Forex - GBP/USD trims losses as risk aversion eases

Published 11/03/2011, 05:15 AM
GBP/USD
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EUR/GBP
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Investing.com – The pound trimmed losses against the U.S. dollar on Thursday, pulling back from an almost two-week low as market sentiment recovered somewhat, but uncertainty over Greece’s planned referendum on its bailout deal lingered.

GBP/USD pulled away from 1.5877, the pair’s lowest since October 21; to hit 1.5946 during European morning trade, dipping 0.02%.

Cable was likely to find support at 1.5753, the low of October 21 and resistance at 1.6047, Wednesday’s high.

On Wednesday, German Chancellor Angela Merkel and French President Nicolas Sarkozy told Greece it will not receive any more financial aid until it decides it wants to remain within the euro zone and warned that Greece will surrender all European aid if it votes against the bailout package agreed upon last week.

Also Wednesday, Federal Reserve Chairman Ben Bernanke said “economic growth strengthened somewhat in the third quarter,” but also warned that “significant downside risks” remain to the outlook.

Speaking at the central bank’s post policy meeting press conference Bernanke said that economic growth was “frustratingly slow” and “very unsatisfactory.” He added that additional round of asset purchases, specifically mortgage-backed securities, was a “viable option

The pound was also higher against the euro, with EUR/GBP slipping 0.13% to hit 0.8608.

Later in the day, the U.K. was to publish data on service sector growth. Meanwhile, the U.S. was to produce its weekly report on initial jobless claims as well as data on service sector activity from the Institute of Supply Management.

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