Investing.com - The pound was at eight month highs against the broadly weaker dollar on Monday after former U.S. Treasury Secretary Lawrence Summers' withdrew from the running to be the next chairman of the Federal Reserve.
GBP/USD hit 1.5958 during European afternoon trade, the highest since January 18; the pair subsequently consolidated at 1.5936, gaining 0.37%.
Cable was likely to find support at 1.5850 and resistance at 1.6003, the high of January 18.
Investor confidence was boosted after Summers' pulled out of the race to succeed Ben Bernanke as the next Fed chairman. Summers' was perceived as being likely to unwind economic stimulus measures more aggressively than his main rival for the post, Janet Yellen.
Investors were also awaiting the outcome of the upcoming Fed policy meeting, which concludes on Wednesday.
A recent series of soft U.S. data raised doubts over whether the central bank will start to taper its USD85 billion-a-month bond buying program this month.
Sterling was slightly lower against the euro, with EUR/GBP easing up 0.13% to 0.8384.
European Central Bank President Mario Draghi said Monday that the economic recovery in the euro zone remains "fragile" and reiterated that interest rates will remain at current or lower levels for an "extended period". The comments came during a speech in Berlin.
The U.S. was to publish the Empire state manufacturing index as well as data on industrial production and the capacity utilization rate later in the trading day.
Investing.com - Investing.com offers an extensive set of professional tools for the financial markets.
Read more News on Investing.com or Follow us on Twitter at @ InvestingCom
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.