Forexpros – The pound remained moderately lower against the U.S. dollar on Monday, as concerns over the debt crisis in the euro zone continued to weigh on market sentiment despite the release of better-than-expected U.S. economic data.
GBP/USD hit 1.5539 during U.S. morning trade, the pair’s lowest since June 15; the pair subsequently consolidated at 1.5559, falling 0.16%.
Cable was likely to find support at 1.5503, the low of June 13 and resistance at 1.5633, the high of June 22.
Official data showed that U.S. new home sales surged to a one-year high, indicating that the housing market may be gaining some momentum.
The Commerce Department said new home sales rose 7.9% to a seasonally adjusted 369,000 units in May, the highest rate since April 2010 and outstripping expectations for a gain of 0.6% to 346,000. New home sales for April totaled 343,000 units.
But market sentiment remained under pressure amid growing doubts over whether European leaders will make any progress towards greater fiscal integration and allowing the bloc’s rescue funds to buy government debt at a summit meeting due to begin on Thursday.
Meanwhile, fears that the debt crisis in the euro area is creating a drag on global growth continued to weigh, following a string of data last Thursday which pointed to weak U.S. manufacturing activity, a shrinking Chinese manufacturing sector and slowing business activity across the single currency bloc.
Earlier Monday, Spain’s government formally requested aid of up to EUR100 billion for its banking sector from its euro zone partners. Spain’s economy minister said the amount should be enough to cover the needs of all banks and provide an additional security buffer.
The request came after the results of an independent audit last week indicated that Madrid would need a rescue package of as much as EUR62 billion to bailout its banks.
Elsewhere, the pound was higher against the euro with EUR/GBP shedding 0.47%, to hit 0.8026.
In the U.K., speculation over the possibility of more easing from the Bank of England continued after BoE policymaker David Miles said earlier that a “substantial” amount of monetary stimulus was needed to shore-up growth in Britain’s “stalled” economy.
In an interview with the Financial Times, Miles reiterated his support for a GBP50 billion expansion of the central bank’s asset purchase program
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