Forexpros – The pound trimmed gains against the U.S. dollar on Monday, easing off a six-week high after a string of worse-than-expected euro zone data overshadowed hopes for a quick breakthrough on resolving the region’s debt crisis.
GBP/USD pulled back from 1.5999, the pair’s highest since September 8, to hit 1.5951 during early European trade, unchanged on the day.
Cable was likely to find support at 1.5753, last Friday’s low and resistance at 1.6082, the high of September 8.
Earlier in the day, preliminary data showed that manufacturing activity in the euro zone slumped to a 27-month low in October. Service sector output in the single-currency bloc also declined to a 27-month low, adding to fears that the euro zone could be slipping into a recession.
However, the pound remained supported after a meeting of European Union leaders on Sunday moved closer to an agreement on recapitalizing European banks and expanding the firepower of the euro zone’s bailout fund, but divisions remain over the restructuring of Greek debt.
Market sentiment was also boosted after private sector data showed that manufacturing activity in China rebounded in October, after contracting in the three previous months.
Meanwhile, the pound was higher against the euro, with EUR/GBP shedding 0.32% to hit 0.8683.
Later Monday, the U.K. parliament was to debate calls for a referendum on Britain’s membership of the European Union, in what was being seen as a test of Prime Minister David Cameron’s authority.
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