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Forex - GBP/USD pushes lower, BoE meeting in focus

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Investing.com - The pound extended losses against the U.S. dollar on Wednesday, as investors remained cautious ahead of the Bank of England's monthly policy-setting meeting on Thursday.

GBP/USD hit 1.5061 during U.S. morning trade, the pair's lowest since March 4; the pair subsequently consolidated at 1.5049, retreating 0.51%.

Cable was likely to find support at 1.4986, the low of March 1 and a two-and-a-half year low and resistance at 1.5185, the high of March 1.

The pound remained under pressure ahead of the BoE's policy announcement on Thursday, amid speculation over whether the central bank will resume its asset purchase program.

Data on Tuesday showing that activity in the U.K. service sector rose to a five-month high in February allayed fears over a triple-dip recession.

The report came one day after data showed that the U.K. construction sector contracted last month. The U.K.'s manufacturing sector also contracted unexpectedly in February.

In the U.S., data showed that factory orders dropped 2% in January, slightly below expectations for a 2.2% decline.

The report came after data showed that ADP non-farm payrolls rose by a seasonally adjusted 198,000 in February, above expectations for an increase of 170,000.

The previous month's figure was revised up to a gain of 215,000 from a previously reported increase of 192,000.

Investors were also awaiting Friday's U.S. data on nonfarm payrolls amid optimism that the economic recovery is gaining momentum. Data on Tuesday showed that the U.S. service sector expanded at its fastest rate in a year in February.

Sterling was lower against the euro with EUR/GBP adding 0.10%, to hit 0.8636.

The euro remained under pressure as concerns over the economic outlook for the euro zone sparked worries that the European Central Bank could flag future rate cuts after its policy meeting on Thursday.

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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.

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