Forex – GBP/USD erases early losses, surges to fresh 7-week high

Published 09/28/2010, 06:14 AM
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Investing.com – The pound erased early losses against the U.S. dollar on Tuesday, surging to hit a fresh 7-week high, after data showed that the U.K.'s current account deficit narrowed more-than-expected in the second quarter.

GBP/USD hit 1.5896 during European morning trade, the pair's highest since August 10; the pair subsequently consolidated at 1.5868, gaining 0.23%.

Cable was likely to find support at 1.5641, last Friday's low and resistance at 1.5995, the high of August 9.

Earlier in the day, the U.K. National Statistics Office said the country’s current account recorded a seasonally adjusted deficit of GBP 7.4 billion in the second quarter, after recording a revised deficit of GBP 11.3 billion in the preceding quarter.

Economists had forecast a deficit of GBP 9.6 billion in the second quarter.

The report said that the current account deficit was 2.0% of GDP in the second quarter, compared to 3.1% in the preceding quarter.

The pound was also up against the euro, with EUR/GBP shedding 0.07% to hit 0.8494.

Later Tuesday, the U.S. was to release official data on house prices as well as a report on consumer confidence.

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