Forexpros – The pound was steady against the U.S. dollar on Wednesday, as investors awaited the minutes from the Bank of England’s June meeting, amid speculation that the central bank may implement more easing measures.
GBP/USD hit 1.5744 during European morning trade, the session low; the pair subsequently consolidated at 1.5729, inching up 0.02%.
Cable was likely to find support at 1.5614, Tuesday’s low and near-term resistance at 1.5756, Tuesday’s high and an almost one-month high.
Date on Tuesday showing an unexpected decline in U.K. consumer price inflation in May added to expectations for more quantitative easing from the BoE, as until now inflation has been easing more slowly than the bank had hoped.
The U.K. Office for National Statistics said that consumer price inflation fell to 2.8% year-over-year from 3.0% in April, against expectations for an unchanged reading.
Markets were also looking ahead to the outcome of the Federal Reserve’s policy meeting later Wednesday, amid talk that the U.S. central bank may implement a third round of monetary easing measures after a recent string of disappointing economic data.
In the euro zone, the yield on Spanish 10-year bonds eased back to just below the critical 7% threshold, after climbing to euro-era highs earlier in the week, amid fears that Madrid will be forced to seek a full-fledged international bailout.
The pound was slightly higher against the euro, with EUR/GBP slipping 0.07% to hit 0.8059.
Also Wednesday, the U.K. was to release official data on claimant count change and the unemployment rate. The Federal Reserve’s policy announcement was to be followed by a press conference with Fed Chairman Ben Bernanke, to discuss the bank’s decision.
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