Investing.com - The pound rose to fresh four-and-a-half year highs against the dollar on Monday, after recent economic data bolstered the outlook for the wider recovery and fuelled expectations for a rate hike by the Bank of England.
GBP/USD touched highs of 1.6852, the most since November 2009 and was last up 0.29% to 1.6845.
Cable was likely to find support at 1.6788, Friday’s low and resistance at 1.6880.
Demand for sterling continued to be underpinned by expectations that the BoE could raise interest rates in the early part of next year.
Expectations for a rate hike were boosted earlier this month after data showed that the U.K. unemployment rate fell to a five-year low of 6.9% in the three months to February, while wage growth also accelerated.
Official data on Friday showed that U.K. retail sales rose 0.1% in March, compared to expectations for a 0.4% decline. On year-over-year basis retail sales were up 4.2%, ahead of expectations for a 3.8% increase.
Market participants were looking ahead to preliminary data on U.K. first quarter growth due for release on Tuesday, amid expectations that growth accelerated in the first three months of this year.
Elsewhere, sterling was almost unchanged against the euro, with EUR/GBP trading at 0.8230.