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Forex - Pound pulls away from 1-month highs vs. dollar

Published 03/18/2016, 05:20 AM
© Reuters.  Pound loses some ground vs. stronger dollar as markets digest Fed statement
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Investing.com - The pound slipped lower against the U.S. dollar on Friday, pulling away from a one-month peak as the greenback recovered from losses posted after the Federal Reserve’s latest policy decision.

GBP/USD hit 1.4440 during European morning trade, the session low; the pair subsequently consolidated at 1.4426, shedding 0.39%.

Cable was likely to find support at 1.4219, Thursday’s low and resistance at 1.4517, the high of February 16.

The dollar came under broad selling pressure after the Fed left its monetary policy unchanged on Wednesday and said that it is likely to raise interest rates twice this year – and not four times, as initially estimated.

Fed policymakers said the U.S. economy faces risks from an uncertain global economy, although moderate growth and "strong job gains" would allow it to tighten policy this year.

The greenback found some support however after the U.S. Department of Labor said on Thursday that jobless claims rose less-than-expected last week.

In addition, the Federal Reserve Bank of Philadelphia said that its manufacturing index improved to 12.4 this month from February's reading of -2.8.

The pound had strengthened on Thursday after the Bank of England said it was holding the benchmark interest rate at 0.50%, in a widely expected move. The rate has been held at that level since March 2009.

The central bank also said it was to maintain the stock of asset purchases financed by the issuance of central bank reserves at £375 billion.

Sterling was fractionally higher against the euro, with EUR/GBP easing 0.09% to 0.7807.

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