Forex Pros – The pound gave up gains against the U.S. dollar on Thursday, pulling back from a six-day high after disappointing economic data reinforced expectations that the Bank of England will keep rates on hold this year.
GBP/USD retreated from 1.6118, the pair’s highest since June 22, to hit 1.6006 during European morning trade, shedding 0.35%.
Cable was likely to find support at 1.5910, Tuesday’s low and a five-month low and resistance at 1.6262, the high of June 22.
Earlier in the day, U.K. mortgage lender Nationwide said its house price index was flat in June, after rising by 0.3% in May and was 1.1% lower on the year.
A separate report showed that U.K. consumer confidence fell more-than-expected in June.
The GfK NOP Consumer Confidence Barometer slipped 4 points to minus 25 in June, surpassing expectations for a decline to minus 23.
All five measures of the index declined, with confidence in the economic outlook for the next year dropping 3 points to minus 18.
The pound has weakened broadly amid speculation that the BoE may resort to further quantitative easing after the minutes of the bank’s June meeting showed that some policymakers believed the growth outlook had weakened.
On Tuesday, BoE Governor Mervyn King said more monetary easing could be viewed as too much of an “easy option” to tackle slow growth, but he also played down the prospect of imminent rate rises.
The pound was also lower against the euro, with EUR/GBP surging 0.70% to hit 0.9051.
Later Thursday, the U.S. was to publish its weekly government report on initial jobless claims, as well as data on manufacturing activity in the Chicago region.
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