Investing.com - The pound was lower against the U.S. dollar on Friday, after the release of mixed U.K. economic reports, while investors remained concerned over the outcome of U.S. budget talks.
GBP/USD hit 1.6242 during European morning trade, the pair's lowest since December 19; the pair subsequently consolidated at 1.6250, falling 0.18%.
Cable was likely to find support at 1.6196, the low of December 18 and resistance at 1.6296, Thursday's high.
Official data showed that the U.K. economy expanded less-than-anticipated in the third quarter, rising 0.09%, below expectations for a 1% rise.
A separate report showed that public sector net borrowing rose more-than-expected in November, rising to GBP15.3 billion from GBP6 billion the previous month. Analysts had expected public sector net borrowing to rise to GBP14.2 billion last month.
Meanwhile, official data also showed that the U.K.'s current account deficit narrowed to GBP12.8 billion in the third quarter from a deficit of GBP17.4 billion, beating expectations for a drop to GBP14 billion.
Investors remained cautious after U.S. House Speaker John Boehner pulled his so-called Plan B fiscal cliff option, which called for tax increases only on those Americans earning USD1 million or more per year, because his Republican colleagues did not support the legislation.
Although U.S. financial markets were to open Friday, the U.S. House has adjourned for the Christmas holiday, fueling speculation that policymakers will not be able to avert the fiscal cliff.
Failure to prevent tax hikes from taking effect at the end of this year right when automatic spending cuts are due to take effect could tip the U.S. economy into a recession.
Sterling was higher against the euro with EUR/GBP slipping 0.16%, to hit 0.8123.
Also Friday, research group Gfk said that its index of Germany's consumer climate fell to 5.6 in December from a reading of 5.8 the previous month. Analysts had expected the index to improve to 5.9 this month.
Later in the day, the U.S. was to release revised data on consumer sentiment from the University of Michigan, as well as government data on personal income and 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.
