Investing.com - Sterling moved lower against the dollar on
Friday, pulling back from the almost five year highs struck earlier
in the week, but demand for the pound continued to be underpinned
by expectations for a U.K. rate hike early next year.
GBP/USD was down 0.48% to 1.6849 late Friday. Earlier in the
week, the pair touched highs of 1.6994, the most since August 2009.
For the week, the pair slipped 0.11%.
Cable is likely to find support at 1.6700 and resistance at
The pound's losses came despite data on Friday showing that
British factory output grew at its fastest quarterly rate in nearly
four years during the first three months of the year.
Output grew 1.4%, up from 0.6% in the fourth quarter of
A separate report showed that the U.K. trade deficit narrowed
unexpectedly in March.
Sterling's losses were checked as a recent string of upbeat
reports about the U.K. economy has bolstered expectations the BoE
could raise borrowing costs ahead of other central banks.
The dollar firmed up on Friday after slumping earlier in the
week following dovish remarks by Federal Reserve Chair Janet Yellen
during testimony to the Joint Economic Committee of Congress.
Speaking Wednesday, Ms. Yellen said that a high degree of
monetary accommodation remains warranted given the slack in the
The Fed chief also said the bank expects economic growth to
accelerate this year despite the slowdown in the first quarter but
warned that the recent housing market slowdown "could prove more
protracted than currently expected."
In the week ahead, investors will be looking ahead to the BoE's
quarterly inflation report for further indications of the expected
course of monetary policy, as well as the latest U.K. employment
The U.S. is to publish reports on retail sales, consumer prices
and consumer sentiment.
Ahead of the coming week, Investing.com has compiled a list of
these and other significant events likely to affect the
Monday, May 12
The U.S. is to publish data on the federal budget balance.
Tuesday, May 13
The U.K. is to release private sector data on retail sales.
The U.S. is to produce data on retail sales, as well as reports
on import prices and business inventories.
Wednesday, May 14
The U.K. is to release official data on the change in the number
of people unemployed and the unemployment rate and average
earnings. The BoE is to publish its quarterly inflation report,
Governor Mark Carney is to hold a press conference to discuss
Later Wednesday, the U.S. is to release data on producer price
Thursday, May 15
The U.S. is to release data on initial jobless claims, consumer
inflation and industrial production, as well as a report on
manufacturing activity in the Philadelphia region.
Friday, May 16
The U.S. is to round up the week with reports on building
permits and housing starts, and a preliminary reading on consumer
sentiment from the University of Michigan.
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