COZforex: The pound was little changed against the firmer dollar on Wednesday after touching session highs earlier when data showed that the number of people claiming unemployment benefits in the UK declined to the lowest level in 2 years in May.

GBP/USD hit 1.5682 amid European afternoon trade, the pair’s highest since June 6; the pair subsequently consolidated at 1.5651, inching up 0.04%. Coz forex senior derivatives trader Daniel • Moloney said, GBP/USD is predicted to find support at 1.5559, and a drop through could take it to the next support line of 1.5473. Meanwhile, the pair is predicted to find its first resistance at 1.5692, and a rose through could take it to the next resistance line of 1.5739.

The dollar firmed up against the other major currencies on Wednesday, regaining ground lost on Tuesday amid fears that global central banks are coming to the end of stimulus programs. Investors remained cautious as speculation that the Federal Reserve will begin to unwind its USD85 billion-a-month asset purchase program this year continued to weigh on market sentiment.

UK industrial production data impressed investors. On the economic front, UK’ industrial production exceeded market expectations by recording a monthly 0.1% rose in April, however manufacturing production figures disappointed, following a monthly 0.2% decline in April. Later, in the National Institute of Economic and Social Research’s monthly estimate, the UK Gross Domestic Product increased by 0.6% in the 3 months ending in May.

The average earnings index rose by a seasonally adjusted 1.3% in the 3 months to April, the fastest rate of increase so far this year, and was 3.3% higher on the month. The data added to optimism over the economic recovery in the UK after data last week showed that service sector activity expanded at the fastest rate since March 2012 last month.

Later today UK’s employment picture shall get more vivid following the release of the claimant count change, claimant count rate and the ILO unemployment rate data.



(COZ forex UK)