For the 24 hours to 23:00 GMT on Friday, GBP fell 0.61% against the USD and closed at 1.6172, as investors sought safety in the greenback amid fears that political differences may hold up fiscal reforms in the US, thereby leading to a possible recession.
In the UK, the gross domestic product (GDP) stood at 0.9% (QoQ) in the Q3 FY2012, from 1.0% in the preceding quarter. Meanwhile, the seasonally adjusted current account deficit narrowed to £12.8 billion in the Q3 FY2012, following a revised deficit of £17.4 billion in the previous quarter. On a quarterly basis, business investments advanced 3.8% in the Q3 FY2012, from 3.7% in the Q2 FY2012. Separately, public sector net borrowing increased to £15.3 billion in November, from a borrowing of £6.0 billion in the previous month. Moreover, the index of services declined 1.1% in the three months ended October, compared to a 1.2% rise in the three months ended September.
In the Asian session, at GMT0400, the pair is trading at 1.6171, with the GBP trading marginally lower from Friday’s close.
Data released this morning in the UK indicated that Hometrack house prices retreated 0.1% (MoM) in December, compared to a similar decline recorded in the previous month.
The pair is expected to find support at 1.6123, and a fall through could take it to the next support level of 1.6075. The pair is expected to find its first resistance at 1.6240, and a rise through could take it to the next resistance level of 1.6308.
The currency pair is trading below its 20 Hr and 50 Hr moving averages.