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Forex - GBP/USD hits 2-day low as BoE rate outlook weighs

Published 04/18/2011, 03:26 AM
Updated 04/18/2011, 03:26 AM
Investing.com – The pound fell to a two-day low against the U.S. dollar on Monday, as markets pared back expectations for a near-term rate hike by the Bank of England after soft U.K. inflation data last week.

GBP/USD hit 1.6260 during early European trade, the pair’s lowest since last Thursday; the pair subsequently consolidated at 1.6275, shedding 0.31%.

Cable was likely to find short-term support at 1.6226, the low of April 12 and resistance at 1.6372, last Friday’s high.

Earlier in the day, U.K. property website Rightmove said asking prices for houses in England and Wales edged 0.1% higher in April compared with a year ago, although agents saw the biggest monthly rise in unsold properties in nearly four years.

Asking prices rose by 1.7% in April, a bigger increase than the 0.8% rise seen during the previous month, but estate agents recorded the biggest monthly increase in unsold stock since May 2007.

Rightmove Director Miles Shipside said prices are likely to come under pressure because lending is tight, interest rates rises are expected this year and public spending cuts and tax hikes are starting to hit.

Meanwhile, the pound edged higher against the euro, with EUR/GBP slipping 0.12% to hit 0.8826.

Later in the day, U.S. Federal Reserve Bank of Dallas President Richard Fisher was due to speak in Atlanta.

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