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Forex - GBP/USD trims losses but remains under pressure

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Investing.com -

Investing.com - The pound trimmed losses against the U.S. dollar on Thursday, but remained under pressure as the greenback continued to recover from news U.S. interest rates will most likely remain on hold for longer than expected.

GBP/USD pulled away from 1.4796, the session low, to hit 1.4895 during European morning trade, still down 0.58%.

Cable was likely to find support at 1.4721, Tuesday's low and resistance at 1.5148, Wednesday's high.

The dollar regained some ground after broadly weakening when the Fed indicated on Wednesday that U.S. economic growth has moderated and that interest rates will rise at a slower pace than previously forecast.

In a statement following its monetary policy meeting, the U.S. central bank also downgraded its forecasts for growth and inflation.

The Fed dropped a reference to being "patient" on the timing of rate hikes, but added that the change in its forward guidance did not mean it has decided on the timing for an initial rate increase.

The pound had dropped to nearly five-year lows against the greenback earlier Wednesday after the U.K. Office for National Statistics said that the rate of unemployment was unchanged at 5.7% in the three months to January, disappointing expectations for a decline to 5.6%.

The report also showed that the claimant count fell 31,000 in February, compared to expectations for a decline of 30,000 people.

In addition, the minutes of the Bank of England's most recent policy meeting showed that all nine members of the Monetary Policy Committee were in favor of maintaining the key interest rate at a record low of 0.5% as well as the central bank's £375 billion asset-purchase program.

Sterling was sharply higher against the euro, with EUR/GBP tumbling 1.18% to 0.7168.

Later in the day, the U.S. was to release reports on jobless claims, the current account and manufacturing activity in the Philadelphia region.

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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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