Forexpros – The pound was almost unchanged against the U.S. dollar on Tuesday, amid uncertainty over whether Italy’s parliament would pass a critical vote on budget reforms as Prime Minister Silvio Berlusconi faced pressure to resign.
GBP/USD hit 1.6100 during European afternoon trade, the session high; the pair subsequently consolidated at 1.6059, inching up 0.03%.
Cable was likely to find support at 1.5945, last Friday’s low and resistance at 1.6151, the high of October 28.
Italy’s parliament was to debate and vote on fiscal reforms, in what was being seen as a test of the prime minister’s majority in parliament and which would determine if he has enough support to stay in power and implement austerity measures.
If the vote is defeated it could topple Mr. Berlusconi’s government and allow for the formation of a new government to guide the country out of its current financial crisis.
Earlier in the day, official data showed that U.K. industrial output was unexpectedly flat in September, but manufacturing output rose more-than-expected.
The data came after an industry report showed that U.K. retail sales fell 0.6% year-on-year in October, underlining concerns over the outlook for growth.
The pound was also fractionally higher against the euro, with EUR/GBP dipping 0.04% to hit 0.8577.
Also Tuesday, finance ministers from the European Union member states were to meet in Brussels to discuss the region’s ongoing financial crisis.
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