Investing.com - The pound was little changed against the dollar on Friday as expectations that the Bank of England may raise interest rates much earlier than it has indicated supported sterling, while ongoing tensions between the U.S. and Syria underpinned the dollar.
GBP/USD fell to lows of 1.5461, the lowest since Wednesday before erasing losses to settle at 1.5503, unchanged for the day and ending the week 0.49% lower.
Cable is likely to find support at 1.5427, Wednesday’s low and resistance at 1.5600.
The pound remained supported after a speech by BoE Governor Mark Carney on Wednesday fell short of some market expectations for an attempt to curb expectations of monetary tightening.
Carney reiterated the central bank’s forward guidance pledge to leave interest rates on hold at record lows until the U.K. unemployment rate falls below 7%, something the bank sees as unlikely for another three years.
Recent improved U.K. economic data has fuelled expectations that the bank could raise rates before then.
The dollar remained supported amid concerns over prospects for a U.S. led military intervention against Syria, following accusations the government used chemical weapons against civilians.
Meanwhile, data on Friday showed that U.S. consumer sentiment was lower in August, pulling back from July’s six-year high. The final reading of the University of Michigan's consumer sentiment index slipped to 82.1 from a final reading of 85.1 in July.
The report came one day after official data showed that U.S. second quarter growth was revised sharply higher, indicating that the economic recovery is on track.
The Commerce Department said gross domestic product expanded at an annual rate of 2.5% in the three months to June, above expectations for growth of 2.2% and up from a preliminary estimate of 1.7%.
The upbeat data reinforced the view that the Federal Reserve could start phasing out stimulus measures as soon as next month.
In the week ahead, markets in the U.S. are to remain closed on Monday for the Labor Day holiday. Investors will be closely watching Friday’s key U.S. nonfarm payrolls report, amid ongoing speculation over when the Fed will start to unwind stimulus measures. Thursday’s interest rate decision by the BoE will also be in focus.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, September 2
The U.K. is to produce data on manufacturing activity, a leading economic indicator.
Markets in the U.S. are to remain closed for the Labor Day holiday.
Tuesday, September 3
The U.K. is to produce data on construction activity, an important economic indicator.
Later in the day, the Institute of Supply Management is to release data on manufacturing activity in the U.S., a leading indicator of economic health.
Wednesday, September 4
The U.K. is also to release data on service sector activity, a leading indicator of economic health.
The U.S. is to release data on the trade balance, the difference in value between imports and exports.
Thursday, September 5
The BoE is to announce its benchmark interest rate.
The U.S. is to release the ADP nonfarm payrolls report on private sector job creation, as well as the weekly government report on initial jobless claims.
Later Thursday, the ISM is to release data on non-manufacturing activity in the U.S., a leading indicator of economic health.
Friday, September 6
The U.K. is to publish data on manufacturing production, consumer inflation expectations and the trade balance.
The U.S. is to round up the week with closely watched government data on nonfarm payrolls and the unemployment rate, as well as data on average hourly earnings.
GBP/USD fell to lows of 1.5461, the lowest since Wednesday before erasing losses to settle at 1.5503, unchanged for the day and ending the week 0.49% lower.
Cable is likely to find support at 1.5427, Wednesday’s low and resistance at 1.5600.
The pound remained supported after a speech by BoE Governor Mark Carney on Wednesday fell short of some market expectations for an attempt to curb expectations of monetary tightening.
Carney reiterated the central bank’s forward guidance pledge to leave interest rates on hold at record lows until the U.K. unemployment rate falls below 7%, something the bank sees as unlikely for another three years.
Recent improved U.K. economic data has fuelled expectations that the bank could raise rates before then.
The dollar remained supported amid concerns over prospects for a U.S. led military intervention against Syria, following accusations the government used chemical weapons against civilians.
Meanwhile, data on Friday showed that U.S. consumer sentiment was lower in August, pulling back from July’s six-year high. The final reading of the University of Michigan's consumer sentiment index slipped to 82.1 from a final reading of 85.1 in July.
The report came one day after official data showed that U.S. second quarter growth was revised sharply higher, indicating that the economic recovery is on track.
The Commerce Department said gross domestic product expanded at an annual rate of 2.5% in the three months to June, above expectations for growth of 2.2% and up from a preliminary estimate of 1.7%.
The upbeat data reinforced the view that the Federal Reserve could start phasing out stimulus measures as soon as next month.
In the week ahead, markets in the U.S. are to remain closed on Monday for the Labor Day holiday. Investors will be closely watching Friday’s key U.S. nonfarm payrolls report, amid ongoing speculation over when the Fed will start to unwind stimulus measures. Thursday’s interest rate decision by the BoE will also be in focus.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, September 2
The U.K. is to produce data on manufacturing activity, a leading economic indicator.
Markets in the U.S. are to remain closed for the Labor Day holiday.
Tuesday, September 3
The U.K. is to produce data on construction activity, an important economic indicator.
Later in the day, the Institute of Supply Management is to release data on manufacturing activity in the U.S., a leading indicator of economic health.
Wednesday, September 4
The U.K. is also to release data on service sector activity, a leading indicator of economic health.
The U.S. is to release data on the trade balance, the difference in value between imports and exports.
Thursday, September 5
The BoE is to announce its benchmark interest rate.
The U.S. is to release the ADP nonfarm payrolls report on private sector job creation, as well as the weekly government report on initial jobless claims.
Later Thursday, the ISM is to release data on non-manufacturing activity in the U.S., a leading indicator of economic health.
Friday, September 6
The U.K. is to publish data on manufacturing production, consumer inflation expectations and the trade balance.
The U.S. is to round up the week with closely watched government data on nonfarm payrolls and the unemployment rate, as well as data on average hourly earnings.