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Forex - Pound extends gains vs. dollar on Lib Dem remarks

Published 04/01/2010, 02:25 AM
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Investing.com – The pound continued its recent rally against the U.S. dollar on Thursday, after the treasury spokesman for a U.K. opposition party dismissed concerns that a hung parliament would result in market turmoil.

GBP/USD hit 1.524 during early Asian trade, a 9-day high; the pair subsequently consolidated around 1.5205, still gaining 0.14%. Cable was likely to find resistance at 1.5382, the high of March 17, and support at 1.4781, the low of March 1.

Late Wednesday, the treasury spokesman for the Liberal Democrats, Vince Cable, said that following an election that failed to give any party a majority in Parliament, the chancellor of the exchequer and his counterparts from the two main opposition parties would probably work together to reduce the nation’s record budget deficit of about 12%.

Sterling also rose versus the euro on Thursday, meanwhile, with EUR/GBP dropping 0.23% to reach 0.8878.

Later in the day, the financial services firm Markit was due to release a manufacturing purchasing managers' index for Britain, and the Bank of England was set to publish the results of a survey of credit conditions in Britain.

Also Thursday, the United States was set to publish an important weekly report on unemployment claims, and an industry group was due to publish a manufacturing purchasing managers' index for the country.

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