Forexpros – The pound edged lower against the U.S. dollar on Wednesday, as a flurry of weak U.S. economic reports and sustained concerns over Spain’s financial troubles dampened market sentiment.
GBP/USD hit 1.5536 during U.S. morning trade, the session low; the pair subsequently consolidated at 1.5549, shedding 0.13%.
Cable was likely to find support at 1.5482, the low of June 11 and resistance at 1.5643, the high of May 30.
The Commerce Department said U.S. retail sales declined by a seasonally adjusted 0.2% in May, falling for the second successive month, marking the first back-to-back- decline in two years.
April’s figure was revised to a 0.2% decline from a previously reported gain of 0.1%.
Core retail sales, which exclude automobile sales, fell by 0.4% last month, the biggest decline since May 2010.
A separate report showed that U.S. producer price inflation fell 0.2% in May, the largest monthly decline since July 2009.
The weak data added to expectations that the Federal Reserve may implement a third round of easing to shore up economic growth after Chicago Fed President Charles Evans reiterated his support for additional monetary stimulus on Tuesday.
Meanwhile, sentiment remained under pressure amid worries that a bailout of as much as EUR100 billion for Spain’s banks will add to the country’s debt burden and make it more difficult for Madrid to access credit markets.
Investors were also focused on the outcome of Sunday’s general election in Greece, which could determine if the country remains in the euro zone
.
Elsewhere, sterling was lower against the euro with EUR/GBP climbing 0.42%, to hit 0.8064.
Also Wednesday, official data showed that industrial production in the euro zone fell for the second consecutive month in April, underlining fears over the health of the region’s economy.
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