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Forex - GBP/USD down on weak U.S. data, debt ceiling vote

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Forexpros - The pound was down against the U.S. dollar on Tuesday, after the House of Representatives voted to raise the U.S. debt ceiling, while weak U.S. manufacturing data supported safe haven demand.

GBP/USD hit 1.6263 during early European trade, the daily low; the pair subsequently consolidated at 1.6287, slipping 0.04%.

Cable was likely to find short-term support at 1.6236, Monday's low and a seven-day low and resistance at 1.6438, the high of July 27.

The outlook for global economic growth remained clouded after data on Monday showed that the U.S. Institute for Supply Management's Manufacturing Index fell to its lowest level in two years in July.

Investors also remained wary amid concerns that a deal to raise the U.S. debt ceiling would not be sufficient to prevent ratings agencies from downgrading the U.S. sovereign debt rating.

On Monday, the House of Representatives approved legislation to raise the U.S. debt ceiling by at least USD2.1 trillion and cut federal spending by as much as USD2.4 trillion. The measure was to go to the Senate for a final vote later in the day.

Meanwhile, the pound was higher against the euro, with EUR/GBP shedding 0.20% to hit 0.8727.

Later in the day, the U.K. was to publish official data on construction activity, while the U.S. was to publish official data on personal consumption expenditures and personal spending.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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