Investing.com – Last week saw the pound close sharply lower against the U.S. dollar as investors remained concerned over the exposure of U.K. banks to Irish debt and after China tightened monetary policy further, dampening risk appetite.
GBP/USD hit 1.5838 on Tuesday, the pair’s lowest since October 28; the pair subsequently consolidated at 1.5976 by close of trade on Friday, tumbling 1.05% over the week.
Cable is likely to find support at 1.5838, last Tuesday’s low and resistance at 1.6153, the high of November 15.
The pound rebounded from Tuesday’s low as European Union officials appeared to make headway in constructing an aid package for Ireland’s ailing banking sector.
But the pound turned lower on Friday, snapping two days of gains after the People’s Bank of China announced that it was raising the reserve requirement ratio for banks for the fifth time this year, effectively draining cash from the financial system to order to curb inflation.
Also last week, official data showed that U.K. consumer price inflation soared to a 4-month high in October, forcing the Bank of England to explain why CPI remained above target.
The rate of inflation was more than a percentage point above the central bank's 2% target. The BOE Governor is obliged to write to the Chancellor of the Exchequer every three months that inflation is more than a percentage point above or below its target.
In his fourth explanatory letter to the government this year, BOE governor Mervyn King said inflation would remain “elevated” throughout 2011.
Next week, the U.S. is due to release a slew of data in a week cut short by the Thanksgiving holiday on Thursday, including revised figures on gross domestic product for the third quarter, durable goods orders, and personal income. The country is also to release its weekly report on jobless claims, while the Federal Reserve is to release the minutes of its most recent monetary policy meeting.
Meanwhile, the U.K. also to release revised figures on third quarter GDP as well as industry data on mortgage approvals. In addition the Bank of England Governor and several BoE Monetary Policy Committee members are due to give testimony on inflation before parliament.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday and Friday as there are no relevant events on these days.
Tuesday, November 23
The U.S. is to begin the week with revised figures on third quarter GDP, the leading indicator of economic growth. The country is also to publish industry data on existing home sales while the Federal Reserve Bank of Richmond is to publish its manufacturing index. Later in the day, the Fed is to publish the minutes of its November monetary policy meeting, providing an in-depth insight into economic and financial conditions in the U.S.
In the U.K., the British Bankers Association is due to publish monthly data on mortgage approvals, an important indicator of economic health. Later in the day, BoE policymaker Adam Posen is due to give a speech in Stockholm; his comments will be closely watched for any clues to the future direction of monetary policy.
Wednesday, November 24
The U.S. is to release a slew of data ahead of the holidays, with official data on initial jobless claims, a leading indicator of economic health as well as government data on personal spending, durable goods orders and new home sales. The country is also to publish revised data on consumer sentiment and inflation expectations as well as reports on crude oil and natural gas inventories.
The U.K. is to publish revised data on third quarter GDP as well as a report on business investment. In addition, BoE policymaker Andrew Sentence is to speak at an event in Belfast.
Thursday, November 25
Markets in the U.S. will remain closed in observance of Thanksgiving Day.
The U.K. will round up the week with industry data on retail sales while Bank of England Governor Mervyn King and several BoE Monetary Policy Committee members are due to testify on inflation and the economic outlook before Parliament's Treasury Committee.
GBP/USD hit 1.5838 on Tuesday, the pair’s lowest since October 28; the pair subsequently consolidated at 1.5976 by close of trade on Friday, tumbling 1.05% over the week.
Cable is likely to find support at 1.5838, last Tuesday’s low and resistance at 1.6153, the high of November 15.
The pound rebounded from Tuesday’s low as European Union officials appeared to make headway in constructing an aid package for Ireland’s ailing banking sector.
But the pound turned lower on Friday, snapping two days of gains after the People’s Bank of China announced that it was raising the reserve requirement ratio for banks for the fifth time this year, effectively draining cash from the financial system to order to curb inflation.
Also last week, official data showed that U.K. consumer price inflation soared to a 4-month high in October, forcing the Bank of England to explain why CPI remained above target.
The rate of inflation was more than a percentage point above the central bank's 2% target. The BOE Governor is obliged to write to the Chancellor of the Exchequer every three months that inflation is more than a percentage point above or below its target.
In his fourth explanatory letter to the government this year, BOE governor Mervyn King said inflation would remain “elevated” throughout 2011.
Next week, the U.S. is due to release a slew of data in a week cut short by the Thanksgiving holiday on Thursday, including revised figures on gross domestic product for the third quarter, durable goods orders, and personal income. The country is also to release its weekly report on jobless claims, while the Federal Reserve is to release the minutes of its most recent monetary policy meeting.
Meanwhile, the U.K. also to release revised figures on third quarter GDP as well as industry data on mortgage approvals. In addition the Bank of England Governor and several BoE Monetary Policy Committee members are due to give testimony on inflation before parliament.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday and Friday as there are no relevant events on these days.
Tuesday, November 23
The U.S. is to begin the week with revised figures on third quarter GDP, the leading indicator of economic growth. The country is also to publish industry data on existing home sales while the Federal Reserve Bank of Richmond is to publish its manufacturing index. Later in the day, the Fed is to publish the minutes of its November monetary policy meeting, providing an in-depth insight into economic and financial conditions in the U.S.
In the U.K., the British Bankers Association is due to publish monthly data on mortgage approvals, an important indicator of economic health. Later in the day, BoE policymaker Adam Posen is due to give a speech in Stockholm; his comments will be closely watched for any clues to the future direction of monetary policy.
Wednesday, November 24
The U.S. is to release a slew of data ahead of the holidays, with official data on initial jobless claims, a leading indicator of economic health as well as government data on personal spending, durable goods orders and new home sales. The country is also to publish revised data on consumer sentiment and inflation expectations as well as reports on crude oil and natural gas inventories.
The U.K. is to publish revised data on third quarter GDP as well as a report on business investment. In addition, BoE policymaker Andrew Sentence is to speak at an event in Belfast.
Thursday, November 25
Markets in the U.S. will remain closed in observance of Thanksgiving Day.
The U.K. will round up the week with industry data on retail sales while Bank of England Governor Mervyn King and several BoE Monetary Policy Committee members are due to testify on inflation and the economic outlook before Parliament's Treasury Committee.