Forexpros – The pound slipped lower against the U.S. dollar on Thursday, after ratings agency Fitch placed the U.K.’s triple-A credit rating on negative outlook late Wednesday, while diminished expectations for monetary easing supported the greenback.
GBP/USD hit 1.5636 during European morning trade, the pair’s lowest since Tuesday; the pair subsequently consolidated at 1.5646, sliding 0.18%.
Cable was likely to find support at 1.5602, the low of March 12 and a five-week low and resistance at 1.5743, Wednesday’s high.
Fitch said that there was a slightly greater than 50% chance that the U.K.’s triple-A rating could be downgraded in the next two years, if the government eases back on implementing harsh austerity measures.
The ratings agency said that while risks arising from the debt crisis in the euro zone had lessened, the situation was not yet completely resolved and could flare up again, threatening the governments ability to stick to deficit reduction measures.
The greenback remained supported after the Federal Reserve upgraded its outlook on the U.S. economy earlier this week, causing investors to trims back expectations for a third round of quantitative easing by the central bank.
The pound was also lower against the euro, with EUR/GBP rising 0.30% to hit 0.8339.
Later in the day, the U.S. was to release government data on producer price inflation, as well as official data on unemployment claims. The country was also to produce reports on manufacturing activity in New York and Philadelphia.
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