Investing.com – The pound was down against the U.S. dollar for a second day on Monday, falling to a fresh three-day low amid a lack of progress over raising the U.S. debt ceiling and lingering concerns over the euro zone’s debt crisis.
GBP/USD hit 1.6008 during U.S. morning trade, the pair’s lowest since July 13; the pair subsequently consolidated at 1.6015, dropping 0.74%.
Cable was likely to find support at 1.5904, the low of July 13 and resistance at 1.6175, Friday’s high.
U.S. President Barack Obama said over the weekend that the U.S. government was “running out of time” in regards to negotiations over lifting the country’s USD14.3 trillion debt ceiling before an August 2 deadline.
Ratings agencies Moody’s and Standard & Poor’s both warned last week that a failure to raise the debt limit in time would result in a downgrade in the credit rating of the world’s largest economy.
Meanwhile, Spanish government bond yields rose to a euro-lifetime high of 6.31%, approaching the 7% mark that prompted peripheral euro zone nations, Greece, Portugal and Ireland to seek bailouts.
Yields on Italian bonds also climbed to a record high of 6.02%, while yields on two-year Greek and Portuguese debt soared to a euro-era record of 35.19% and 24.1% respectively.
Euro zone finance ministers were to meet Thursday to focus on “the financial stability of the euro area as a whole and the future financing of the Greek program,” according to the president of the European Council, Herman Van Rompuy.
Results from the European Banking Authority’s stress tests failed to ease concerns over the health of the region’s banking sector, as the tests did not include the possibility of a sovereign debt default, which many believe was a likely outcome for Greece.
The said Friday that eight banks out of the region’s 90 top lenders failed its stress tests, with a combined capital shortfall of EUR2.5 billion.
The EBA said 16 banks narrowly passed the stress tests. Of the banks that failed the tests, five were in Spain, two in Greece and one in Austria, while all banks tested in the U.K. and Ireland passed.
Sterling was also weighed after industry data showed earlier that U.K. house prices fell 1.6% in July, the first decline this year. Home prices rose 0.6% in June.
Elsewhere, the pound was higher against the euro, with EUR/GBP down 0.13% to hit 0.8762.
Earlier in the day, official data showed that U.S. treasury international capital purchases rose significantly less-than-expected in May.
In a report, the U.S. Department of the Treasury said that net foreign purchases of long-term securities totaled USD23.6 billion in May, below expectations of USD48.4 billion.
GBP/USD hit 1.6008 during U.S. morning trade, the pair’s lowest since July 13; the pair subsequently consolidated at 1.6015, dropping 0.74%.
Cable was likely to find support at 1.5904, the low of July 13 and resistance at 1.6175, Friday’s high.
U.S. President Barack Obama said over the weekend that the U.S. government was “running out of time” in regards to negotiations over lifting the country’s USD14.3 trillion debt ceiling before an August 2 deadline.
Ratings agencies Moody’s and Standard & Poor’s both warned last week that a failure to raise the debt limit in time would result in a downgrade in the credit rating of the world’s largest economy.
Meanwhile, Spanish government bond yields rose to a euro-lifetime high of 6.31%, approaching the 7% mark that prompted peripheral euro zone nations, Greece, Portugal and Ireland to seek bailouts.
Yields on Italian bonds also climbed to a record high of 6.02%, while yields on two-year Greek and Portuguese debt soared to a euro-era record of 35.19% and 24.1% respectively.
Euro zone finance ministers were to meet Thursday to focus on “the financial stability of the euro area as a whole and the future financing of the Greek program,” according to the president of the European Council, Herman Van Rompuy.
Results from the European Banking Authority’s stress tests failed to ease concerns over the health of the region’s banking sector, as the tests did not include the possibility of a sovereign debt default, which many believe was a likely outcome for Greece.
The said Friday that eight banks out of the region’s 90 top lenders failed its stress tests, with a combined capital shortfall of EUR2.5 billion.
The EBA said 16 banks narrowly passed the stress tests. Of the banks that failed the tests, five were in Spain, two in Greece and one in Austria, while all banks tested in the U.K. and Ireland passed.
Sterling was also weighed after industry data showed earlier that U.K. house prices fell 1.6% in July, the first decline this year. Home prices rose 0.6% in June.
Elsewhere, the pound was higher against the euro, with EUR/GBP down 0.13% to hit 0.8762.
Earlier in the day, official data showed that U.S. treasury international capital purchases rose significantly less-than-expected in May.
In a report, the U.S. Department of the Treasury said that net foreign purchases of long-term securities totaled USD23.6 billion in May, below expectations of USD48.4 billion.