Forexpros – The pound extended losses against the U.S. dollar on Tuesday, as safe haven demand was supported amid concerns over the outlook for global economic growth and ongoing uncertainty over Greece’s progress in concluding a debt swap deal.
GBP/USD hit 1.5758 during European afternoon trade, the pair’s lowest since February 24; the pair subsequently consolidated at 1.5788, shedding 0.48%.
Cable was likely to find support at 1.5721, the low of February 24 and resistance at 1.5881, the session high.
Market sentiment was hit earlier after official data showed that the euro zone’s gross domestic product shrank by a seasonally adjusted 0.3% in the fourth quarter, in line with expectations and unchanged from a preliminary estimate.
Annualized GDP contracted at a rate of 0.7%, also in line with expectations and unrevised from an initial estimate.
The data fuelled concerns over the outlook for global growth, coming one day after Chinese Premier Wen Jiabao said his government will target expansion of 7.5% in 2012, the lowest GDP target in eight years.
Investors also remained jittery ahead of the March 8 deadline for Greece’s private creditors to sign on to a EUR106 billion debt swap deal, a requirement for Athens to tap a recently approved EUR130 billion bailout fund.
Earlier in the day, Greek finance minister Evangelos Venizelos strongly urged private sector creditors to take part in the debt swap deal and warned that it was the best offer they would receive.
In the U.K., a report by the British Retail Consortium showed that total retail sales rose at an annualized rate of 2.3% in February, after a 2.1% gain the previous month.
However, the report said like-for-like retail sales fell 0.3% on the year in February, after declining by the same amount in January.
The pound was almost unchanged against the euro, with EUR/GBP inching up 0.01% to hit 0.8330.
Also Tuesday, a report by mortgage lender Halifax showed that U.K. house prices fell unexpectedly in February, dropping 0.5% after rising by 0.6% in January, continuing the mixed monthly pattern seen over the past year.
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