Forexpros – The pound extended gains against the U.S. dollar on Thursday, after weak U.S. manufacturing data but investors remained concerned over the euro zone’s financial woes.
GBP/USD hit 1.5802 during U.S. morning trade, the daily high; the pair subsequently consolidated at 1.5786, rising 0.35%.
The pair was likely to find support at 1.5631, the low of October 18 and resistance at 1.5846, the high of October 19.
Sterling found support after a report showed that manufacturing activity in the Philadelphia region fell unexpectedly in November.
The Federal Reserve Bank of Philadelphia said that its manufacturing index deteriorated by 5.1 points to 3.6 from October’s reading of 8.7. Analysts had expected the index to improve by 0.3 points to 9.0 in November.
Market sentiment was boosted earlier, after government data showed that U.S. building permits rose more-than-expected in October, climbing to the highest level since March 2010. The report also showed that U.S. housing starts were largely unchanged in October.
A separate report revealed that the number of people who filed for unemployment assistance in the U.S. in the week ending November 11 fell by 5,000 to a seven-month low of 388,000.
Earlier in the day, Spanish 10-year bond yields surged to a euro-era high of 6.97% earlier, close to the 7% threshold widely seen as unsustainable in the long term.
Meanwhile, French 10-year bond yields also climbed to their highest level since the inception of the single currency, adding to fears over sovereign debt contagion to core euro zone economies.
Elsewhere, the pound was down against the euro with EUR/GBP rising 0.11%, to trade at 0.8566.
Also Thursday, official data showed that U.K. retail sales rose unexpectedly in October, climbing 0.6% after a 0.5% rise the previous month. Analysts had expected retail sales to fall 0.2% in October.
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