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Forex - GBP/USD extends gains on upbeat U.K. employment report

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Investing.com -

Investing.com - The pound extended this week's gains against the dollar on Thursday after investors applauded U.K. jobs numbers and sidestepped the greenback in wake of a lackluster U.S. retail sales report released earlier.

In U.S. trading on Thursday, GBP/USD was trading up 0.35% at 1.6846, from a session low of 1.6739 and off a high of 1.6860.

Cable was likely to find support at 1.6739, the earlier low, and resistance at 1.6882, the high from May 27.

Data released Wednesday revealed the U.K. claimant count, or number of people receiving jobless benefits fell by 27,400 in May, beating for a for a decline of 25,000 people. April's figure was revised to a drop of 28,400 from 25,100, and markets continued to applaud the report on Thursday.

The data added to the view that the Bank of England will raise interest rates ahead of other central banks as the economic recovery continues to gather momentum, which gave the pound an edge over the greenback.

Meanwhile in the U.S., the Commerce Department reported earlier that U.S. retail sales rose 0.3% in May, missing expectations for a 0.6% gain. However, retail sales for April were revised up to a 0.5% gain from a previously reported increase of 0.1%.

Core retail sales, which exclude automobile sales, eased up 0.1% in May, disappointing forecasts for a 0.2% increase. Core sales in April were revised up to 0.4% from a previously reported flat reading.

Separately, the Labor Department reported that the number of individuals filing for initial jobless benefits in the week ending June 7 increased by 4,000 to 317,000, confounding expectations for a decline of 3,000, though markets largely shrugged off the report.

Thursday's mixed U.S. data kept markets rethinking how much time will elapse after the Federal Reserve concludes stimulus programs and before the U.S. central bank hikes interest rates, which softened the dollar.

Elsewhere, sterling was up against the euro, with EUR/GBP down 0.19% at 0.8045, and up against the yen, with GBP/JPY up 0.13% at 171.60.

On Friday, the U.S. is to round up the week with data on producer price inflation and preliminary data on consumer sentiment from the University of Michigan.

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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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