Forex - GBP/USD almost unchanged, close to 6-year highs

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Investing.com - The pound was almost unchanged against the U.S. dollar on Friday, hovering close to six-year highs as expectations for the Bank of England to soon raise interest rates continued to support.

GBP/USD hit 1.7131 during U.S. morning trade, the session low; the pair subsequently consolidated at 1.7150, dipping 0.03%.

Cable was likely to find support at 1.7096, the low of July 1 and resistance at 1.7180, the session high and the most since October 2008.

Sterling has strengthened broadly since the start of this year, gaining more the 13% against the dollar amid expectations that the deepening U.K. recovery will prompt the Bank of England to raise rates before the end of the year.

Meanwhile, demand for the greenback remained supported after the Labor Department on Thursday reported that that U.S. economy added 288,000 jobs last month, easily surpassing expectations for an increase of 212,000, and that the U.S. unemployment rate fell to 6.1% from 6.3% in May, the lowest in almost six years.

The upbeat jobs report fuelled optimism over the strength of the labor market and bolstered the outlook for the broader economic recovery.

Sterling was higher against the euro, with EUR/GBP edging down 0.14% to 0.7923.

Sentiment on the single currency remained vulnerable after European Central Bank President Mario Draghi reiterated on Thursday the bank's forward guidance that rates will remain on hold at present or lower levels for an extended period.

He emphasized that "the governing council is also unanimous in its commitment to use unconventional instruments' if necessary, to address the risk of too-prolonged period of low inflation."

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This article appears in: Investing , Forex and Currencies

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