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Forex - GBP/USD remains moderately lower, Fed in focus

Posted: 10/25/2013 10:26:00 AM
Referenced Stocks: - " The pound remained moderately lower against the U.S. dollar on Friday, but losses were limited as the release of weak U.S. consumer sentiment data added to speculation that the Federal Reserve will hold back from tapering its asset purchases this year.

GBP/USD hit 1.6167 during U.S. morning trade, the session low; the pair subsequently consolidated at 1.6184, edging down 0.12%.

Cable was likely to find support at 1.6030, the low of September 27 and short-term resistance at 1.6257, the high of October 23.

In a revised report, the Universtiy of Michigan said its consumer sentiment index fell to 73.2 this month, from a reading of 75.2 in September, compared to expectations for a downtick to 75.0.

The University of Michigan also said inflation expectations ticked up to 3.0% in October, from 2.9% the previous month.

The data came after the Census Bureau said that U.S. core durable goods orders, which exclude transportation items, fell 0.1% in September, confounding expectations for a 0.5% rise, after a 0.1% decline the previous month.

U.S. durable goods orders rose 3.7% last month, exceeding expectations for a 2% increase, after a 0.1% rise in August.

The dollar came under broad selling pressure this week after disappointing U.S. employment reports added to expectations that the Fed will delay tapering its stimulus program until next year amid concerns over the impact of the 16-day U.S. government shutdown on the economic recovery.

On Thursday, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits declined by a lower than expected 12,000 last week to 350,000, while a separate report earlier in the week showed that U.S. jobs growth slowed in September.

In the U.K., preliminary data earlier showed that the U.K. gross domestic product rose 0.8% in the third quarter, in line with expectations and up from 0.7% in the previous quarter.

Sterling was lower against the euro with EUR/GBP adding 0.14%, to hit 0.8530.

Also Friday, the Ifo Institute for Economic Research said Germany's business climate index fell to 107.4 in October, from a reading of 107.7 the previous month, confounding expectations for a rise to 108.0. offers an extensive set of professional tools for the financial markets.
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