Investing.com - The pound held steady against the U.S. dollar in subdued trade on Monday, as U.K. data published last week continued to support demand for sterling, while the greenback remained strong on the back of upbeat U.S. economic reports.
GBP/USD hit 1.6396 during U.S. morning trade, the session low; the pair subsequently consolidated at 1.6419, easing 0.02%.
Cable was likely to find support at 1.6310, the low of January 17 and resistance at 1.6509, the high of January 10.
Demand for sterling continued to be underpinned after data on Friday showed that U.K. retail sales jumped 2.6% in December from a month earlier and were 5.3% higher on a year-over-year basis.
Analysts had expected a monthly increase of 0.4% and an annual gain of 2.6%.
The strong data reinforced the view that the economic recovery will continue to deepen going into this year and fuelled expectations that the Bank of England may raise interest rates ahead of other central banks.
Meanwhile, the greenback remained supported after recent U.S. economic data last week reinforced expectations that the recovery is strong enough for the Federal Reserve to make further reductions to its asset purchase program at its policy meeting later in the month.
Sterling was lower against the euro, with EUR/GBP edging up 0.14% to 0.8257.
Trade volumes were expected to remain thin on Monday, with U.S. markets closed for a holiday.