Forex - GBP/USD remains moderately higher, focus on Fed By South CCAA Investments/Forex News The pound remained moderately higher against the U.S. dollar on Wednesday, still supported by earlier U.K. employment data, although investors remained cautious ahead of the Federal Reserves policy statement due later in the day. Forex - GBP/USD remains moderately higher, focus on FedPound holds earlier gains vs. dollar before Fed statement GBP/USD hit 1.6654 during U.S. morning trade, the pairs highest since Monday; the pair subsequently consolidated at 1.6623, adding 0.20%. Cable was likely to find support at 1.6480, the low of January 27 and resistance at 1.6717, the high of March 13. Earlier in the day, the Office for National Statistics reported that rate of unemployment remained unchanged at 7.2% in the three months to January, in line with expectations. In addition, the number of people claiming unemployment benefits fell by 34,600 last month, the ONS said, compared to expectations for a decline of 25,000. January’s figure was revised to a drop of 33,900 people from a previously reported decline of 27,600. The number of people in employment hit a new high of just under 30.2m, helped by a rise in self-employment, the report said. The average earnings index rose 1.4% in January, the largest increase since mid-2013 and ahead of expectations for a 1.3% increase. Last month, the Bank of England updated its forward guidance on interest rates, after the unemployment rate fell more quickly than expected towards the 7% level it set as a threshold for considering rate hikes. Separately, the minutes of the BoE’s March meeting indicated that the economic recovery in the U.K. is broadening, but still has some way to go before it is sustainable. The minutes also noted differences between officials over how much slack there is in Britains labor market. The minutes showed that the monetary policy committee voted unanimously to keep interest rates at a record low 0.5% this month. Elsewhere, the Fed was widely expected to announce a third reduction in the monthly pace of its bond purchases from $65 billion to $55 billion at the conclusion of its monthly meeting later Wednesday, the first with Janet Yellen at the helm. The central bank was also expected to confirm that recent softness in U.S. economic reports was due to severe winter weather. Sterling was higher against the euro, with EUR/GBP shedding 0.38% to 0.8366
Posted on: Thu, 20 Mar 2014 09:29:36 +0000
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