Investing.com - The pound rose against the dollar on Wednesday
after the Federal Reserve said it was leaving interest rates near
zero and was sticking with its monthly stimulus programs.
In U.S. trading on Wednesday, GBP/USD was trading at 1.5796, up
0.21%, up from a session low of 1.5725 and off from a high of
The pair was likely to find support at 1.5675, Monday's low, and
resistance at 1.5892, the high from Jan. 23.
The dollar fell after the Federal Reserve announced it was sticking
with loose monetary policies, including its USD85 billion monthly
bond-purchasing program, known as quantitative easing, which
weakens the dollar as a side effect.
"Although strains in global financial markets have eased somewhat,
the Committee continues to see downside risks to the economic
outlook," the Federal Open Market Committee in charge of setting
interest rates said in a statement.
Earlier Wednesday, The Commerce Department reported that the U.S.
gross domestic product contracted for the first time since the
second quarter of 2009 in the three months ending December,
shrinking by 0.1%.
Economists were forecasting growth of 1.1% after a 3.1% expansion
in the preceding quarter,.
A 6.6% decline in government spending and a significant drop in
private inventories contributed to the contraction, which did come
with several silver linings.
The report added that consumer spending rose by 2.2% and business
investment was 8.8% higher in the fourth quarter of last year.
Elsewhere, payroll processor ADP revealed that the U.S. private
sector added 192,000 jobs in January, well above expectations for
an increase of 165,000.
The pound, meanwhile, was down against the euro and up against the
yen, with EUR/GBP trading down 0.36% at 0.8588 and GBP/JPY up 0.72%
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