Investing.com - The pound trimmed gains against the U.S. dollar on Thursday, reapproaching recently hit five-month lows as demand for the greenback found broad support after upbeat U.S. economic reports.
GBP/USD pulled away from 1.6614, the pair's highest since August 20, to hit 1.6576 during U.S. morning trade, still up 0.01%.
Cable was likely to find support at 1.6537, Wednesday's low and a five-month low and resistance at 1.6679, the high of August 20.
The dollar found support after preliminary data showed that U.S. gross domestic product expanded by 4.2% in the second quarter, beating expectations for growth of 3.9%, after an expansion of 4.0% in the three months to April.
In addition, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending August 22 declined by 1,000 to 298,000 from the previous week’s revised total of 299,000.
Analysts had expected the number of individuals filing for initial jobless benefits to rise by 1,000 to 300,000 last week.
The strong data confirmed Federal Reserve Chair Janet Yellen's comments at Jackson Hole last week saying that the U.S. economy is recovering and the labor market is improving.
A separate report showed that U.S. pending home sales increased by 3.3% last month, compared to expectations for a 0.5% rise. June's figure was revised to a 1.3% drop from a previously estimated decline of 1.1%.
In the U.K., the Confederation of British Industry earlier reported that realized sales rose to a six-month high of 37 this month, from a reading of 21 in July, compared to expectations for a rise to 27.
Sterling was higher against the euro, with EUR/GBP shedding 0.19% to 0.7944.
Also Thursday, preliminary data showed that German consumer price inflation was flat in August, in line with expectations, after a 0.3% rise the previous month.
Data also showed that the number of unemployed people in Germany rose by 2,000 last month, confounding expectations for a decline of 5,000.
The euro had found support earlier, as expectations for fresh stimulus measures by the European Central Bank slightly eased after German Finance Minister Wolfgang Schauble said on Wednesday that ECB President Mario Draghi's recent comments on the matter have been "over-interpreted."