GBP/USD pulled away from 1.5415, the pair's lowest since June 6, to hit 1.5457 during U.S. morning trade, still down 0.18%.
Cable was likely to find support at 1.5380, the low of June 6 and resistance at 1.5492, the session high.
The Federal Reserve Bank of Philadelphia said that its manufacturing index rose to 12.5 in June from minus 5.2 in May, outstripping expectations for a reading of minus 2.0 and rising at the fastest pace since April 2011.
A separate report showed that U.S. existing home sales climbed 4.2% to a seasonally adjusted 5.18 million units in May from April’s total of 4.97 million, and well above expectations for a 0.6% increase.
The data came after the Department of Labor said the number of individuals filing for initial jobless benefits last week rose by 18,000 to a seasonally adjusted 354,000, a three-week high, compared to expectations for an increase of 4,000 to 340,000.
The dollar strengthened broadly earlier, after Fed Chairman Ben Bernanke on Wednesday said the bank could begin slowing asset purchases by the end of 2013 and wind them down completely by the middle of 2014 if the economy picks up as the central bank expects.
In the U.K., the Office for National Statistics said U.K. retail sales climbed 2.1% in May, outstripping expectations for a gain of 0.8% after falling 1.1% in April, the largest drop in a year.
Retail sales were 1.9% higher from a year earlier, compared to expectations for a 0.2% increase.
The ONS said food sales rose 3.5% in May, the largest increase in two years, while non-store retailing, including online sales was up 4.3%.
The data added to the view that the economic recovery in the U.K. is gaining traction in the second quarter.
Sterling was higher against the euro with EUR/GBP retreating 0.70%, to hit 0.8525.
Also Thursday, the euro zone manufacturing PMI rose to 48.7 in June from a final reading of 48.3 in May, but remained well below the 50 level that separates contraction from expansion.
Service sector activity in the euro zone improved to a 15-month high in June, with the services PMI rising to 48.6 from 47.2 in May, above expectations for an increase to 47.5.