Forexpros – The pound trimmed gains against the U.S. dollar on Tuesday, pulling back from a six-day high after Italian Prime Minister Silvio Berlusconi won a critical budget vote but lost his parliamentary majority.
GBP/USD pulled back from 1.6113, the pair’s highest since October 31 to hit 1.6080 during U.S. morning trade, still up 0.15%.
The pair was likely to find support at 1.5964, the low of October 31 and resistance at 1.6185, the high of September 5.
Berlusconi won the vote on the ratification of Italy’s 2010 public accounts after the parliamentary opposition abstained, but he obtained only 308 votes, far below the 316 needed for an absolute majority in the Chamber of Deputies.
The opposition immediately called for the prime minister to resign and allow a new government to steer the country out of the euro zone’s debt crisis.
Meanwhile, Reuters reported that Greek leaders were wrapping up talks with the intention of naming former European Central Bank deputy head Lucas Papademos as the new prime minister of a crisis coalition.
But the pound remained supported after the U.K. National Institute of Economic and Social Research said it expected gross domestic product to remain unchanged at 0.5% in November.
Earlier in the day, official data showed that U.K. manufacturing production rose slightly more-than-expected in September, but industrial output was unexpectedly flat.
Elsewhere, the pound was almost unchanged against the euro, with EUR/GBP inching up 0.02%, to hit 0.8581.
Also Tuesday, Finland’s prime minister called for stronger surveillance of troubled euro zone countries, ahead of a meeting of European Union finance ministers later in the day, saying they must present concrete plans on how they will balance their budgets.
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