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Forex - GBP/USD pushes higher as sentiment improves broadly

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Investing.com - The pound pushed higher against the U.S. dollar on Thursday, as market sentiment strengthened broadly following comments by European Central Bank President Mario Draghi and after the Bank of England left its monetary policy unchanged.

GBP/USD hit 1.6096 during U.S. morning trade, the pair's highest since January 8; the pair subsequently consolidated at 1.6105, advancing 0.51%.

Cable was likely to find support at 1.6004, the session low and resistance at 1.6128, the high of January 7.

Speaking at the bank's post-policy meeting press conference Draghi said a gradual economic recovery would begin this year, as structural reforms and actions by the ECB to tackle the region's debt crisis continued to take effect.

The comments came after the ECB left interest rates on hold at 0.75% in a widely anticipated decision earlier, but some market participants had expected Draghi to hint at the possibility of rate cuts later in 2013.

Sentiment also improved after Spain saw borrowing costs fall sharply at an auction of government debt, while Italy's borrowing costs fell to the lowest level since January 2010 at an auction of 12-month government bonds.

Earlier in the day, the BoE kept its benchmark interest rate on hold at 0.5% and maintained the size of its asset purchase program at GBP375 billion, in a widely anticipated decision.

Sterling was lower against the euro with EUR/GBP climbing 0.57%, to hit 0.8200.

Also Thursday, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending January 5 rose by 4,000 to a seasonally adjusted 371,000, compared to expectations for a decline of 2,000 to 365,000.

Jobless claims for the preceding week were revised down to 367,000 from a previously reported 372,000.

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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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