Forexpros – The pound was up against the U.S. dollar on Tuesday, tracking the euro higher as market sentiment slightly recovered but gains were limited amid ongoing concerns over European and U.S. sovereign debt.
GBP/USD hit 1.5692 during European morning trade, the daily high; the pair subsequently consolidated at 1.5680, rising 0.24%.
The pair was likely to find support at 1.5541, the low of October 12 and resistance at 1.5803, the high of October 20.
The pound found support after Greek Finance Minister Evangelos Venizelos said earlier that euro zone officials would make a decision regarding the next tranche of Greek aid as soon as November 29.
Spain’s newly elected Prime Minister Mariano Rajoy said he will hold his first cabinet meeting on December 23 to examine ways to cut the budget deficit.
In the U.S., a congressional “super committee” failed to forge a deficit reduction deal and called for Congress to work out an agreement before painful automatic budget cuts take place in 2013.
Ratings agency Fitch said that a failure to reach an agreement was likely to result in a revision of the rating outlook to “negative,” rather than a downgrade.
Meanwhile, the pound was also weighed by concerns over fresh monetary easing measures after a senior Bank of England policymaker said last week that there was a “very strong case” for extending the central bank’s asset purchase program next year.
Sterling was lower against the euro with EUR/GBP rising 0.15%, to hit 0.8637.
Later in the day, the U.K. was to produce official data on public sector borrowing.
The U.S. was also to release preliminary data on gross domestic product, and the U.S. Federal Reserve was to publish the minutes of its November policy meeting, later Tuesday.
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