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Forex - GBP/USD steady ahead of BoE meeting

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Investing.com - The pound was little changed close to five-week lows against the U.S. dollar on Thursday, ahead of a Bank of England policy meeting later in the trading day.

GBP/USD hit 1.6030 during European morning trade, the session low; the pair's subsequently consolidated at 1.3067, inching up 0.03%.

Cable was likely to find support at 1.5991, Wednesday's low and a five-week low and resistance at 1.6074, Wednesday's high.

Analysts expected the BoE to keep rates on hold at 0.5% and not announce any additional easing measures following its policy meeting later Thursday.

Sentiment on sterling remained fragile after a recent string of weak economic data reinforced concerns over the outlook for the U.K. economic recovery.

Data last week showing that the U.K. service sector contracted for the first time in two years in December fuelled fears that the economy slid back into a recession in the fourth quarter.

Investors were also anticipating a European Central Bank policy meeting later in the trading day.

The ECB was widely expected to hold off cutting rates following its policy-setting meeting, but some market participants expected President Mario Draghi to flag the possibility of rate cuts later in the year.

The euro was little changed against the pound, with EUR/GBP dipping 0.01% to 0.8153.

Later Thursday both Spain and Italy were to hold auctions of government bonds, while the U.S. was to release the weekly government report on initial jobless claims.

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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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