Investing.com - The pound trimmed losses against the U.S. dollar in cautious trade on Monday, as concerns over the outlook for the global economy weighed ahead of the start of testimony on the U.S. economy by Federal Reserve Chairman Ben Bernanke on Tuesday.
GBP/USD pulled back from 1.5518, the session low to 1.5547 in European afternoon trade, still down 0.18%.
Cable was likely to find support at 1.5485, the low of July 11 and resistance at 1.5592, the session high.
The pound was supported by safe haven buying, with investors viewing the pound as a safe local alternative to the euro.
Friday’s announcement that the Bank of England is to launch a new GBP80 billion 'funding for lending' program, which will offer cheaper loans to households and businesses, also bolstered demand for sterling.
But the mood in markets remained cautious amid uncertainty over whether some bondholders could be forced to accept losses under the terms of Spain's bank bailout.
Elsewhere, Germany’s constitutional court announced that it will deliver a ruling on whether the euro zone’s permanent bailout fund contravenes the German constitution on September 12, disappointing hopes for an earlier decision.
Meanwhile, investors were looking ahead to Fed Chairman Ben Bernanke's testimony on the economic outlook to the U.S. Senate on Tuesday and Wednesday, amid ongoing speculation over whether the central bank will introduce more easing measures to stimulate the economy.
The pound hit a fresh three-and-a-half year high against the euro, with EUR/GBP down 0.24% to 0.7844, but was weaker against the yen, with GBP/JPY down 0.44% to 122.77.
Later Monday, the U.S. was to publish official data on retail sales and business inventories, as well as a report on manufacturing activity in New York. In addition, the International Monetary Fund was to publish forecasts for global economic growth.
GBP/USD pulled back from 1.5518, the session low to 1.5547 in European afternoon trade, still down 0.18%.
Cable was likely to find support at 1.5485, the low of July 11 and resistance at 1.5592, the session high.
The pound was supported by safe haven buying, with investors viewing the pound as a safe local alternative to the euro.
Friday’s announcement that the Bank of England is to launch a new GBP80 billion 'funding for lending' program, which will offer cheaper loans to households and businesses, also bolstered demand for sterling.
But the mood in markets remained cautious amid uncertainty over whether some bondholders could be forced to accept losses under the terms of Spain's bank bailout.
Elsewhere, Germany’s constitutional court announced that it will deliver a ruling on whether the euro zone’s permanent bailout fund contravenes the German constitution on September 12, disappointing hopes for an earlier decision.
Meanwhile, investors were looking ahead to Fed Chairman Ben Bernanke's testimony on the economic outlook to the U.S. Senate on Tuesday and Wednesday, amid ongoing speculation over whether the central bank will introduce more easing measures to stimulate the economy.
The pound hit a fresh three-and-a-half year high against the euro, with EUR/GBP down 0.24% to 0.7844, but was weaker against the yen, with GBP/JPY down 0.44% to 122.77.
Later Monday, the U.S. was to publish official data on retail sales and business inventories, as well as a report on manufacturing activity in New York. In addition, the International Monetary Fund was to publish forecasts for global economic growth.