Forex Pros – The euro held gains against the pound on Thursday, trading close to a two-week high despite data showing that activity in the U.K. construction sector picked up faster than expected in May, helped by a strong rise in new orders.
EUR/GBP hit 0.8823, the pair’s highest since May 20, during European morning trade; the pair subsequently consolidated at 0.8805, gaining 0.38%.
The pair was likely to find support at 0.8743, Wednesday’s low and resistance at 0.8844, the high of May 19.
The Markit/CIPS headline construction purchasing managers index rose to 54.0 in May from 53.3 in April. Economists had expected the index to rise to 53.6.
The survey said employment in the sector increased for the first time since June 2010 and that firms were their most optimistic in a year about future activity.
However, the data was unlikely to alter expectations that the Bank of England would raise interest rates this year after data on Wednesday showed that manufacturing activity in the U.K. grew at its slowest pace in 20 months in May.
The euro remained supported even after Moody’s on Wednesday cut Greece’s credit rating by three notches to Caa1 on debt restructuring worries.
Meanwhile, the pound was up against the U.S. dollar, with GBP/USD rising 0.22% to hit 1.6370.
Later in the day, the U.S. was to publish its weekly report on initial jobless claims, as well as revised data on non-farm productivity and labor costs. The country was also to publish official data on factory orders.
ForexPros.com
