Investing.com - The pound was lower against the dollar on Friday as hopes for a breakthrough on the U.S. budget and debt ceiling deadlock in Washington supported the greenback, while disappointing U.K. economic data weighed on sterling.
GBP/USD ended Friday’s session at 1.5944, 0.13% lower for the day, after falling as low as 1.5912 on Thursday. For the week, the pair was down 0.94%.
Cable is likely to find short-term support at 1.5885 and resistance at 1.6120.
Sentiment on the dollar was boosted as House Republicans and the Obama administration began a second day of negotiations on a deal to reopen the government and raise the U.S. government borrowing limit for six weeks.
The U.S. risks running out of cash if the debt ceiling is not raised by 17 October.
Meanwhile, concerns over economic impact of the political deadlock in Washington fuelled expectations that the Federal Reserve will further delay plans to start phasing out its USD85 billion a month asset purchase program.
Wednesday’s minutes of the Fed’s September meeting said the decision not to begin tapering stimulus was a "close call," with all but one voting member opting to leave the program unchanged.
Data released on Friday showed that U.S. consumer sentiment fell to the lowest level in nine months in October, as concerns over the impact of the government shutdown weighed.
The University of Michigan’s consumer sentiment index declined to 75.2 from a final reading of 77.5 in September, and below expectations for a reading of 76.0.
Sterling came under pressure after data released on Friday showed that U.K. construction sector output slipped 0.1% in August, a sharp slowdown after a 2.8% increase in July.
Earlier in the week, data showed that U.K. industrial production fell at the fastest rate in nearly a year in August, rising doubts over the outlook for third quarter growth.
The Office for National Statistics said U.K. industrial production fell 1.1% in August, defying expectations for a 0.4% increase, after inching up 0.1% in July.
The ONS said manufacturing production fell by a seasonally adjusted 1.2% in August, confounding expectations for a 0.4% increase.
In the week ahead, investors will continued to closely monitor political developments in Washington. Trade volumes are likely to remain light on Monday, with U.S. markets closed for a holiday. U.K data on employment and retail sales will be in focus as markets attempt to gauge the strength of the economic recovery.
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 Friday as there are no relevant events on this day.
Monday, October 14
Markets in the U.S. are to remain closed for the Colombus Day holiday.
Tuesday, October 15
The U.K. is to produce official data on consumer price inflation and producer price inflation.
The U.S. is to release a report on manufacturing activity in the Empire state.
Wednesday, October 16
The U.K. is to release official data on the change in the number of people unemployed and the unemployment rate, as well as data on average earnings.
Thursday, October 17
The U.K. is to produce data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.
The U.S. is to publish the weekly government report on initial jobless claims, as well as data on manufacturing activity from the Philly Fed.
GBP/USD ended Friday’s session at 1.5944, 0.13% lower for the day, after falling as low as 1.5912 on Thursday. For the week, the pair was down 0.94%.
Cable is likely to find short-term support at 1.5885 and resistance at 1.6120.
Sentiment on the dollar was boosted as House Republicans and the Obama administration began a second day of negotiations on a deal to reopen the government and raise the U.S. government borrowing limit for six weeks.
The U.S. risks running out of cash if the debt ceiling is not raised by 17 October.
Meanwhile, concerns over economic impact of the political deadlock in Washington fuelled expectations that the Federal Reserve will further delay plans to start phasing out its USD85 billion a month asset purchase program.
Wednesday’s minutes of the Fed’s September meeting said the decision not to begin tapering stimulus was a "close call," with all but one voting member opting to leave the program unchanged.
Data released on Friday showed that U.S. consumer sentiment fell to the lowest level in nine months in October, as concerns over the impact of the government shutdown weighed.
The University of Michigan’s consumer sentiment index declined to 75.2 from a final reading of 77.5 in September, and below expectations for a reading of 76.0.
Sterling came under pressure after data released on Friday showed that U.K. construction sector output slipped 0.1% in August, a sharp slowdown after a 2.8% increase in July.
Earlier in the week, data showed that U.K. industrial production fell at the fastest rate in nearly a year in August, rising doubts over the outlook for third quarter growth.
The Office for National Statistics said U.K. industrial production fell 1.1% in August, defying expectations for a 0.4% increase, after inching up 0.1% in July.
The ONS said manufacturing production fell by a seasonally adjusted 1.2% in August, confounding expectations for a 0.4% increase.
In the week ahead, investors will continued to closely monitor political developments in Washington. Trade volumes are likely to remain light on Monday, with U.S. markets closed for a holiday. U.K data on employment and retail sales will be in focus as markets attempt to gauge the strength of the economic recovery.
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 Friday as there are no relevant events on this day.
Monday, October 14
Markets in the U.S. are to remain closed for the Colombus Day holiday.
Tuesday, October 15
The U.K. is to produce official data on consumer price inflation and producer price inflation.
The U.S. is to release a report on manufacturing activity in the Empire state.
Wednesday, October 16
The U.K. is to release official data on the change in the number of people unemployed and the unemployment rate, as well as data on average earnings.
Thursday, October 17
The U.K. is to produce data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.
The U.S. is to publish the weekly government report on initial jobless claims, as well as data on manufacturing activity from the Philly Fed.