Forexpros – The pound held gains against the U.S. dollar on Tuesday, shrugging off a downward revision by the British government for economic growth as markets eyed a meeting of euro zone finance ministers later in the day.
GBP/USD hit 1.5656 during U.S. morning trade, the pair’s highest since November 22; the pair subsequently consolidated at 1.5626, rising 0.73%.
Cable was likely to find support at 1.5468, the low of November 29 and resistance at 1.5797, the high of November 21.
In the U.K. government’s autumn budget statement, Chancellor George Osborne said the economy was now expected to grow 0.7% in 2012, down from a March budget forecast of 2.5% growth.
Growth was then expected to recover to 2.1% in 2013.
Osborne also said borrowing will fall much less than expected, meaning that harsh austerity measures will last beyond 2015.
“Much of Europe appears to be heading into recession caused by a chronic lack of confidence in the ability of countries to deal with their debts. We will do whatever it takes to protect Britain from this debt storm while doing all we can to build the foundations of future growth,” he said.
The pound remained supported ahead of a keenly awaited meeting of euro zone finance ministers later in the day. The ministers were expected to approve plans to enlarge the scope of the region’s bailout fund and to sign off on Greece’s next tranche of financial aid.
Earlier in the day, the Bank of England said net lending to individuals rose by GBP1.3 billion in October, above expectations for GBP1.0 billion, while the number of final mortgage approvals rose to their highest level since December 2009.
The data came after U.K. mortgage lender Nationwide said house prices rose unexpectedly this month, climbing 0.4%, confounding expectations for a decline of 0.1%.
Elsewhere, the pound was sharply higher against the euro with EUR/GBP shedding 0.61%, to hit 0.8533.
In the U.S., the Conference Board said consumer confidence soared in November, rising to the highest level since July, but overall readings remained historically weak.
A separate report showed that U.S. house prices fell for the 15th consecutive month in September, falling at an annualized rate of 3.6%, outstripping expectations for a 3% decline.
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