Investing.com - The pound fell sharply against the broadly stronger U.S. dollar on Friday, following the release of better-than-expected U.S. employment data while weak data on U.K. industrial production weighed on sterling.
GBP/USD hit 1.5881 on Tuesday, the weekly high; the pair subsequently consolidated at 1.5673 by close of trade on Friday, dropping 1.02% over the week.
Cable is likely to find short-term support at 1.5644, the low of February 14 and resistance at 1.5832, Friday’s high.
The Department of Labor said the U.S. economy added 227,000 jobs in February after adding an upwardly revised 284,000 the previous month. The unemployment rate held steady at a three year low of 8.3%.
The strong data boosted the dollar as it diminished expectations for a fresh round of asset purchases by the Federal Reserve to help stimulate economic growth.
Earlier Friday, the pound slipped against the greenback after official data showed that U.K. industrial output fell unexpectedly in January. The data contrasted with a recent string of improving data, which had dampened expectations that the Bank of England would implement a fresh round of monetary easing.
On Thursday, the BoE left its benchmark interest rate unchanged at a record low of 0.5% and announced no expansion to its GBP325 billion asset purchase program, following a GBP50 billion increase in February.
In the euro zone, Greece announced that more than 85% of its private creditors had signed up to a debt swap deal on Friday, aimed at restructuring 53.5% of the country’s debt.
The deal cleared the way for Athens to secure a second bailout worth EUR130 billion and avert a default.
But market sentiment was tempered after the International Swaps and Derivatives Association said the debt swap constituted a “credit event” that would activate credit-default swaps, which designed to protect investors against losses on Greek sovereign debt.
In the week ahead, investors will be continuing to watch developments in Greece, after Friday’s ISDA ruling. Market participants will also be watching Tuesday’s rate statement by the Federal Reserve as well as U.S. data on retail sales. In addition, the U.K. is set to publish key employment data on Wednesday.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 12
The U.S. is to publish government data on the federal budget balance.
Tuesday, March 13
The U.K. is to release industry data on house price inflation, as well as official data on the trade balance, which is the difference in value between imported and exported goods.
The U.S. is to release government data on retail sales, the foremost indicator of consumer spending, which accounts for the majority of overall economic activity. The country is also to produce official data on business inventories, a signal of future business spending.
Also Tuesday, the Federal Reserve is to announce its benchmark interest rate; the announcement will be accompanied by the central bank’s rate statement.
Wednesday, March 14
The U.K. is to publish official data on claimant count change, the first indication of the employment situation, as well data on the country’s unemployment rate.
Later in the day, the U.S. is to produce official data on the country’s current account, as well as data on import prices and crude oil stockpiles. In addition, Federal Reserve Chairman Ben Bernanke is also due to speak; his comments will be closely watched for clues to the future possible direction of monetary policy.
Thursday, March 15
The U.S. is to release government data on producer price inflation, a leading indicator of consumer inflation, as well as official data on unemployment claims. The country is also to produce reports on manufacturing activity in New York and Philadelphia, as well as a government report on net long-term securities transactions.
Friday, March 16
The U.S. is to round up the week with government data on consumer price inflation, followed by reports from the Federal Reserve on the capacity utilization rate and industrial production. In addition, the country is also to release preliminary reports by the University of Michigan on consumer sentiment and inflation expectations.
GBP/USD hit 1.5881 on Tuesday, the weekly high; the pair subsequently consolidated at 1.5673 by close of trade on Friday, dropping 1.02% over the week.
Cable is likely to find short-term support at 1.5644, the low of February 14 and resistance at 1.5832, Friday’s high.
The Department of Labor said the U.S. economy added 227,000 jobs in February after adding an upwardly revised 284,000 the previous month. The unemployment rate held steady at a three year low of 8.3%.
The strong data boosted the dollar as it diminished expectations for a fresh round of asset purchases by the Federal Reserve to help stimulate economic growth.
Earlier Friday, the pound slipped against the greenback after official data showed that U.K. industrial output fell unexpectedly in January. The data contrasted with a recent string of improving data, which had dampened expectations that the Bank of England would implement a fresh round of monetary easing.
On Thursday, the BoE left its benchmark interest rate unchanged at a record low of 0.5% and announced no expansion to its GBP325 billion asset purchase program, following a GBP50 billion increase in February.
In the euro zone, Greece announced that more than 85% of its private creditors had signed up to a debt swap deal on Friday, aimed at restructuring 53.5% of the country’s debt.
The deal cleared the way for Athens to secure a second bailout worth EUR130 billion and avert a default.
But market sentiment was tempered after the International Swaps and Derivatives Association said the debt swap constituted a “credit event” that would activate credit-default swaps, which designed to protect investors against losses on Greek sovereign debt.
In the week ahead, investors will be continuing to watch developments in Greece, after Friday’s ISDA ruling. Market participants will also be watching Tuesday’s rate statement by the Federal Reserve as well as U.S. data on retail sales. In addition, the U.K. is set to publish key employment data on Wednesday.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, March 12
The U.S. is to publish government data on the federal budget balance.
Tuesday, March 13
The U.K. is to release industry data on house price inflation, as well as official data on the trade balance, which is the difference in value between imported and exported goods.
The U.S. is to release government data on retail sales, the foremost indicator of consumer spending, which accounts for the majority of overall economic activity. The country is also to produce official data on business inventories, a signal of future business spending.
Also Tuesday, the Federal Reserve is to announce its benchmark interest rate; the announcement will be accompanied by the central bank’s rate statement.
Wednesday, March 14
The U.K. is to publish official data on claimant count change, the first indication of the employment situation, as well data on the country’s unemployment rate.
Later in the day, the U.S. is to produce official data on the country’s current account, as well as data on import prices and crude oil stockpiles. In addition, Federal Reserve Chairman Ben Bernanke is also due to speak; his comments will be closely watched for clues to the future possible direction of monetary policy.
Thursday, March 15
The U.S. is to release government data on producer price inflation, a leading indicator of consumer inflation, as well as official data on unemployment claims. The country is also to produce reports on manufacturing activity in New York and Philadelphia, as well as a government report on net long-term securities transactions.
Friday, March 16
The U.S. is to round up the week with government data on consumer price inflation, followed by reports from the Federal Reserve on the capacity utilization rate and industrial production. In addition, the country is also to release preliminary reports by the University of Michigan on consumer sentiment and inflation expectations.