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Forex - GBP/USD remains lower after positive U.S. data

ForexJul 24, 2013 02:24PM GMT Add a Comment
Investing.com - The pound remained lower against the U.S. dollar on Wednesday, as data showing that U.S. new home sales jumped to a five-year high in June added to expectations for the Federal Reserve to soon begin scaling back its stimulus program, supporting demand for the greenback.

GBP/USD hit 1.5315 during U.S. morning trade, the pair's lowest since July 22; the pair subsequently consolidated at 1.5347, slipping 0.15%.

Cable was likely to find support at 1.5265, the low of July 22 and resistance at 1.5440, the high of June 26.

The Commerce Department said U.S. new home sales jumped 8.3% to a seasonally adjusted annual rate of 497,000 units, the highest level since May 2008.

Analysts had expected new home sales to rise 1.8% to an annual rate of 482,000.

The data came after Fed Chairman Ben Bernanke said last week that the pace of the bank’s bond purchases would depend on U.S. economic health.

Sterling was higher against the euro with EUR/GBP adding 0.12%, to hit 0.8612.

Also Wednesday, data showed that the euro zone composite purchasing managers’ index rose to 50.4 in the current month from 48.7 in June, on the back of stronger data from Germany and France.

The report fuelled optimism that the bloc’s economy could emerge from a recession in the third quarter.

Germany’s manufacturing PMI rose to 50.3 from June's reading of 48.6, and the service sector PMI jumped to 52.5, from 50.4.

The French manufacturing PMI ticked up to a 17-month high of 49.8 from 48.4 in June, while France’s services PMI improved to 48.2 from 47.2 last month.

This offset fears over a slowdown in the world’s second largest economy after data released earlier Wednesday showed that Chinese manufacturing activity slumped to an 11-month low in July.

The preliminary reading of China’s HSBC manufacturing PMI fell to 47.7 in July, from a final reading of 48.2 last month. Analysts had expected the index to rise to 48.6.


Forex - GBP/USD remains lower after positive U.S. data
 

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