Investing.com – The pound extended losses against the U.S. dollar on Monday, tracking the euro lower as senior euro zone officials prepared to meet amid concerns that the region's sovereign debt crisis could spread to Italy.
GBP/USD hit 1.5937 during European afternoon trade, the daily low; the pair subsequently consolidated at 1.5943, dropping 0.70%.
The pair was likely to find short-term support at 1.5910, the low of June 28 and a five-month low and resistance at 1.6077, Friday’s high.
Later in the day, senior European Union officials, including European Central Bank President Jean-Claude Trichet and EU economy commissioner Olli Rehn were to meet to discuss a second bailout package for Greece and assess the risk of the sovereign debt crisis spreading from Greece to Italy.
The meeting was called after the cost of insuring Italian sovereign debt against default rose sharply on Friday amid concerns over the country’s sovereign debt load, ahead of the release of European bank stress test results later this week.
The single currency was also weighed by speculation that euro zone officials could accept a selective Greek default, following a report in the Financial Times on Sunday.
Meanwhile, the pound was higher against the euro, with EUR/GBP tumbling 0.70% to hit 0.8820.
The Bank of England kept interest rates unchanged at a record low of 0.5% last Thursday, in a widely expected decision and now looks increasingly unlikely to raise interest rates before next summer.
GBP/USD hit 1.5937 during European afternoon trade, the daily low; the pair subsequently consolidated at 1.5943, dropping 0.70%.
The pair was likely to find short-term support at 1.5910, the low of June 28 and a five-month low and resistance at 1.6077, Friday’s high.
Later in the day, senior European Union officials, including European Central Bank President Jean-Claude Trichet and EU economy commissioner Olli Rehn were to meet to discuss a second bailout package for Greece and assess the risk of the sovereign debt crisis spreading from Greece to Italy.
The meeting was called after the cost of insuring Italian sovereign debt against default rose sharply on Friday amid concerns over the country’s sovereign debt load, ahead of the release of European bank stress test results later this week.
The single currency was also weighed by speculation that euro zone officials could accept a selective Greek default, following a report in the Financial Times on Sunday.
Meanwhile, the pound was higher against the euro, with EUR/GBP tumbling 0.70% to hit 0.8820.
The Bank of England kept interest rates unchanged at a record low of 0.5% last Thursday, in a widely expected decision and now looks increasingly unlikely to raise interest rates before next summer.