Forex – GBP/USD trims losses after weak U.S. sentiment data

Published 09/28/2010, 10:16 AM
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Investing.com – The pound trimmed losses against the U.S. dollar on Tuesday, retreating from a 2-day low, following the release of worse-than-expected data on U.S. consumer sentiment.

GBP/USD retreated from 1.5718, the pair's lowest since September 24, to hit 1.5766 during European afternoon trade, shedding 0.36%.

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, data showed that the Conference Board's index of U.S. consumer sentiment fell to 48.5 in September after rising to a revised 53.2 in August. Analysts had expected the index to decline to 52.9 in September.

Commenting on the report, Lynn Franco, Director of The Conference Board Consumer Research Center said, “September’s pull-back in confidence was due to less favorable business and labor market conditions, coupled with a more pessimistic short-term outlook. Overall, consumers’ confidence in the state of the economy remains quite grim".

The pound was also down against the euro, with EUR/GBP gaining 0.60% to hit 0.8551.

Also Tuesday, Bank of England policy maker Adam Posen said Britain needed aggressive economic stimulus to stop it falling into the same kind of slump Japan did in the 1990's.

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