Investing.com - The pound was lower against the dollar on Friday
after Fitch's ratings agency downgraded the U.K.'s triple-A rating,
citing the deteriorating economic outlook.
GBP/USD hit session lows of 1.5225 before settling at 1.5230, 0.32%
lower for the day and down 0.43% for the week.
Cable is likely to find support at 1.5098, the low of April 2 and
resistance at 1.5366, Friday's high.
Fitch downgraded the U.K.'s triple-A rating by one notch to AA+
with a stable outlook on Friday blaming "the weak growth
performance of the UK economy in recent years", which it says are
partly due to "headwinds of private and public sector deleveraging
and the euro zone crisis".
The downgrade came after the International Monetary Fund warned
Tuesday that the British government should scale back its austerity
program, given current weakness in the U.K. economy.
Official data on Wednesday showed that the U.K. unemployment rate
unexpectedly rose to 7.9% last month, from 7.8% in February.
Meanwhile, Wednesday's minutes of the Bank of England's April
meeting showed that policymakers remained split over monetary
policy. Outgoing Governor Mervyn King and two other policymakers
backed more easing, while six voted against.
Elsewhere, sterling rallied more than 1% against the yen on Friday,
with GBP/JPY advancing 1.06% to settle at 151.52.
The yen weakened across the board after finance ministers from the
Group of 20 nations indicated that they support Japan's efforts to
spur growth through aggressive monetary easing policies.
In the week ahead, investors will be awaiting Friday's U.S. data on
first quarter growth amid lingering concerns that the U.S. economic
recovery is losing momentum. Markets will also be closely watching
Thursday's U.K. data on first quarter growth.
Ahead of the coming week, Investing.com has compiled a list of
these and other significant events likely to affect the markets.
Monday, April 22
The U.S. is to release private sector data on existing home sales,
a leading indicator of demand in the housing market.
Tuesday, April 23
The U.K. is to publish official data on public sector net borrowing
and private sector data on industrial order expectations.
The U.S. is to produce official data on new home sales as well as
preliminary data on manufacturing activity.
Wednesday, April 24
The U.K. is to release private sector data on retail sales, an
important indicator of economic health.
The U.S. is to release government data on durable goods orders, a
leading indicator of production, as well as data on crude oil
Thursday, April 25
The U.K. is to release preliminary data on first quarter gross
domestic product, the broadest indicator of economic activity and
the leading measure of the economy's health.
The U.S. is to produce the weekly government report on initial
jobless claims later in the trading day.
Friday, April 26
The U.S. is to round up the week with preliminary data on first
quarter growth, the broadest indicator of economic activity and the
leading measure of the economy's health.
The U.S. is also to release revised data from the University of
Michigan on consumer sentiment and inflation expectations.
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