Forex Pros – The euro extended gains against the pound on Wednesday, jumping to a four-day high after the Bank of England’s April policy meeting minutes showed policymakers maintained their 6-3 split in favor of keeping rates on hold.
EUR/GBP hit 0.8864 during European morning trade, the pair’s highest since April 15; the pair subsequently consolidated at 0.8857, rallying 0.82%.
The pair was likely to find support at 0.8739, Tuesday’s low and an eight-day low and resistance at 0.8923, the high of April 13 and a five-month high.
The monetary policy committee said mixed economic data over the month did not provide clear guidance about the extent to which the economy had recovered since the slowdown at the end of 2010.
“An increase in Bank rate in current circumstances could adversely affect consumer confidence, leading to an exaggerated impact on spending,” the minutes said.
However, policymakers said near-term inflation was likely to be higher than forecast in February due to higher energy and commodity prices and there was still a significant risk that inflation would exceed 5%.
Meanwhile, the pound was up against the dollar, with GBP/USD rising 0.23% to hit 1.6353.
Later Wednesday, the U.S. was to publish industry data on existing home sales.
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