Forexpros – The pound fell to a three-week low against the U.S. dollar on Monday, as concerns over the outlook for global economic growth weighed, ahead of the release of data on U.K. service sector activity.
GBP/USD hit 1.6112 during early European trade, the pair’s lowest since August 11; the pair subsequently consolidated at 1.6139, shedding 0.47%.
Cable was likely to find support at 1.6039, the low of July 19 and resistance at 1.6252, last Friday’s high.
Fears over the outlook for global growth were underlined after the U.S. Labor Department said Friday that the economy added no new jobs in August for the first time in nearly a year.
Economists had expected non-farm payrolls to rise by 74,000 last month. The jobless rate remained unchanged at 9.1%.
The bleak data added to expectations that the Federal Reserve will embark on a third round of monetary stimulus, to shore up U.S. growth.
Elsewhere, in the euro zone, German Chancellor Angela Merkel’s ruling party were defeated in local elections on Sunday, amid dissatisfaction over her handling of the euro zone debt crisis, adding to pressure on the single currency.
The pound was also slightly lower against the euro, with EUR/GBP inching up 0.05% to hit 0.8765.
Later in the day, the U.K. was to publish data on service sector activity, while markets in the U.S. were to remain closed for the Labor Day holiday.
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