Forexpros – The pound was higher against the U.S. dollar on Wednesday, but gains looked likely to remain limited as concerns over rising Spanish borrowing costs fuelled fears that the debt crisis in the euro zone is flaring up again.
GBP/USD hit 1.5929 during European morning trade, the session high; the pair subsequently consolidated at 1.5897, up 0.23%.
Cable was likely to find support at 1.5808, Tuesday’s low and short-term resistance at 1.5930, Tuesday’s high and a one-week high.
Earlier Wednesday, the yield on Spain’s 10-year government continued to tick higher, briefly rising to 6.01%, amid concerns that the effects of the European Central Bank’s liquidity operation is wearing off.
Spanish Prime Minister Mariano Rajoy was to make a speech on the country’s recent austerity budget later in the day, as investors remained fearful that deficit reduction targets will not be met and the country will need a bailout.
Meanwhile, last week’s weaker-than-expected data on U.S. nonfarm payrolls continued to cloud the outlook for the global economic recovery.
The pound was slightly higher against the euro, with EUR/GBP slipping 0.08% to hit 0.8240.
Also Wednesday, the U.S. was to release official data on import prices and crude oil stockpiles, as well as a report on the federal budget balance. The Federal Reserve was also to publish its Beige Book.
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