Forexpros – The pound pushed higher against the U.S. dollar on Monday, as market sentiment firmed up after Italy unveiled measures to cut the country’s deficit and amid hopes for an agreement ahead of a critical European Union summit this week.
GBP/USD hit 1.5662 during European early morning trade, the daily high; the pair subsequently consolidated at 1.5652, gaining 0.34%.
Cable was likely to find support at 1.5575, Friday’s low and resistance at 1.5725, Friday’s high.
Market sentiment was boosted after Italian Prime Minister Mario Monti unveiled a EUR30 billion package of austerity measures designed to reduce the euro zone’s second-biggest debt on Sunday, including measures to raise taxes and increase the pension age.
Meanwhile, German Chancellor Angela Merkel was to hold talks with French President Nicolas Sarkozy to outline proposals for stricter enforcement of the region’s budget discipline that will be presented to European Union leaders at Friday’s summit.
The pound was slightly lower against the euro, with EUR/GBP easing up 0.08% to hit 0.8593.
Later Monday, the U.K. was to publish a report on service sector growth. The U.S. was to release government data on factory orders, while the Institute of Supply Management was to produce a report on service sector activity.
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