Investing.com - The dollar rose to two-week highs against the
pound on Friday as the improving U.S. economic outlook fuelled
hopes that the Federal Reserve would begin to wind up its
quantitative easing program.
GBP/USD hit 1.5314 on Friday; the pair's lowest since April 25,
before paring back losses to settle at 1.5365, down 0.55% for the
day and 1.13% lower for the week.
Cable is likely to find support at 1.5263, the low of April 25 and
resistance at 1.5586, Thursday's high.
The greenback was boosted as recent upbeat U.S. economic data
fuelled optimism over an earlier-than-expected end to the Federal
Reserve's USD85 billion a month asset purchase program.
Data on Thursday showed that showed that U.S. initial jobless
claims fell to the lowest level since January 2008 in the week
ending May 4.
Earlier this month official data showed that the U.S. economy added
more jobs than forecast in April, pushing the unemployment rate to
a more than four-year low of 7.5%.
The dollar's broad based rally saw the currency advance to its
highest level since October 2008 against the yen on Friday.
The dollar rose above 101 per yen after data showed that Japanese
investors became net purchasers of overseas bonds in the past two
weeks as the Bank of Japan's massive easing program prompted
investors to seek out higher yields overseas to compensate for
lower yields on Japanese government bonds.
Sterling rose to its highest level against the yen since August
2009 on Friday, with GBP/JPY hitting session highs of 156.69,
before settling at 156.07, up 0.43%.
The pound ended the week lower against the euro, with EUR/GBP
easing up 0.15% to settle at 0.8454, 0.47% higher for the week.
In the week ahead, investors will be watching Wednesday's U.K. jobs
data and the Bank of England's inflation report.
The U.S. is to release official data on retail sales, building
permits, jobless claims and a closely watched report on consumer
Ahead of the coming week, Investing.com has compiled a list of
these and other significant events likely to affect the markets.
Monday, May 13
The U.S. is to release official data on retail sales and business
Tuesday, May 14
The U.S. is to publish official data on import prices.
Wednesday, May 15
The U.K. is to release government data on the change in the number
of people employed and the unemployment rate, a leading economic
The BoE is to release its quarterly inflation report. Governor
Mervyn King is to speak at a press conference following the release
of the report.
The U.S. is to release data on producer price inflation, industrial
production, the capacity utilization rate and a report on
manufacturing activity in New York State.
Thursday, May 16
The U.S. is to produce official data on building permits, the
leading indicator of future construction activity as well as data
on housing starts.
The U.S. is also to release official data on consumer inflation,
initial jobless claims and the Philly Fed manufacturing index.
Friday, May 17
The U.S. is to round up the week with preliminary data from the
University of Michigan on consumer sentiment and inflation
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