Investing.com - The pound pulled back from seven month lows against the dollar on Friday after the latest U.S. jobs report showed that job creation slowed to an eight month low in August.
GBP/USD was trading at 1.6325 late Friday, down 0.02%, off the lows of 1.6285 touched earlier in the session, the weakest level since February 6.
Cable was likely to find support at around 1.6220 and resistance at the 1.6375 level.
The dollar weakened after the Labor Department reported that that U.S. economy added 142,000 jobs last month, disappointing expectations for jobs growth of 225,000. July’s figure was revised up to 212,000. The unemployment rate ticked down to 6.1% from 6.2% in July.
The report eased concerns that the recovery in the U.S. economy is progressing so rapidly that the Federal Reserve will be forced to raise rates sooner prevent the economy from overheating.
Demand for the greenback continued to be underpinned after other economic reports earlier in the week indicated that the U.S. recovery is still on track. Data on Tuesday showed that the country’s manufacturing sector expanded at the fastest rate in more than three years in August.
Sterling remained under heavy selling pressure amid uncertainty over the outcome of a referendum on Scottish independence, due to take place on September 18.
Concerns over the impact of Scottish independence on the U.K. economy outweighed data on Wednesday showing that activity in the U.K. service sector expanded at the fastest rate in 10 months in August.
The upbeat data indicated that the outlook for growth in the third quarter remained strong.
The euro edged higher against sterling on Friday, with EUR/GBP trading up 0.09% for the day at 0.7933 in late trade.
The pair fell 0.8% on Thursday after the European Central Bank cut rates to record lows and announced fresh stimulus measures in an attempt to shore up slowing growth and inflation in the euro area.
The Bank of England left monetary policy unchanged on Thursday, in a widely anticipated decision.
The minutes of the meeting, due to be published in two weeks, will indicate how many monetary policy committee members voted in favor of a rate hike. The MPC was split last month, with two members voting in favor of a rate hike and two against.
In the week ahead, investors will be looking ahead to Friday’s U.S. data on retail sales and consumer sentiment for further indications on the strength of the economic recovery.
Testimony on inflation by BoE officials on Wednesday 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. The guide skips Monday as there are no relevant events on this day.
Tuesday, September 9
The U.K. is to produce data on industrial and manufacturing production and a report on the trade balance. Meanwhile, BoE Governor Mark Carney is to speak at an event in Manchester; his comments will be closely watched.
Wednesday, September 10
BoE Governor Mark Carney and several monetary policy committee members are to testify on inflation and the economic outlook before Parliament’s Treasury committee.
Thursday, September 11
The U.S. is to produce the weekly report on initial jobless claims.
Friday, September 12
The U.S. is to release data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity. The U.S. is also to release what will be closely watched preliminary data on consumer sentiment.