Forexpros – The pound advanced to a one-month high against the broadly weaker U.S. dollar on Thursday, after the Federal Reserve signaled that interest rates are likely to remain low into late 2014 and indicated it may consider further monetary easing.
GBP/USD hit 1.5700 during European morning trade, the pair’s highest since December 23; the pair subsequently consolidated at 1.5689, gaining 0.21%.
Cable was likely to find support at 1.5649, the session low and resistance at 1.5773, the high of December 21.
At the conclusion of Wednesday’s policy-setting meeting, the Fed said economic conditions will likely “warrant exceptionally low levels for the federal funds rate at least through late 2014.”
The central bank had previously pledged to keep interest rates close to zero until mid-2013.
The Fed also revised down its forecast for economic growth this year to a range of between 2.2% and 2.7%, from a range of 2.5% to 2.9% in November.
Fed Chairman Ben Bernanke said that policy makers were “prepared to provide further monetary accommodation” and added that bond buying is “an option that’s certainly on the table,” indicating that the bank may embark on a third round of quantitative easing.
In the euro zone, talks on a debt swap deal between Greece and its creditors were to resume in Athens later in the day.
The pound was also higher against the euro, with EUR/GBP shedding 0.23% to hit 0.8352.
Also Thursday, the U.K. was to publish industry data on retail sales, while the U.S. was to release official data on initial jobless claims and durable goods orders.
Forexpros
