Forex - GBP/USD gains on U.K. retail sales, Bernanke comments weigh

Forex - GBP/USD gains on U.K. retail sales, Bernanke comments weigh

Submitted by caseyb23 on Fri, 07/19/2013 - 02:55

Forex - GBP/USD gains on U.K. retail sales, Bernanke comments weigh

Investing.com – The pound moved higher against the dollar on Thursday after U.K. retail sales beat expectations, though reassuring words from Federal Reserve Chairman Ben Bernanke that stimulus measures will end eventually but will not usher in an era of monetary tightening bolstered the dollar and capped Cable's gains.

In U.S. trading on Thursday, GBP/USD was trading at 1.5217, up 0.03%, up from a session low of 1.5158 and off from a high of 1.5242.

Cable was likely to find support at 1.5028, Monday's low, and resistance at 1.5268, Wednesday's high.

The pound rose earlier after official data revealed that U.K. retail sales rose 0.2% in June, in line with expectations and were also up 2.2% from June of last year.

Monthly retail sales met analysts' expectations though the on-year numbers beat market calls for a 1.7% increase.

The pound's advances were limited in part from Fed Chairman Bernanke's soothing comments.

Bernanke told U.S. lawmakers in his semi-annual congressional testimony earlier that stimulus programs will remain in place for the foreseeable future though they may begin to wind down later this year if the economy improves.

Stimulus programs such as the Fed's USD85 billion monthly asset-purchasing program tend to weaken the dollar to spur recovery, and talk of their dismantling can firm up the U.S. currency.

Bernanke stressed that an end to such stimulus programs will not herald the arrival of tighter monetary policy, adding that benchmark lending rates may remain at rock-bottom levels even if the country's monthly unemployment rate approaches 6.5%, a level the U.S. central bank has said it would like to see.

The pound, meanwhile, was up against the euro and up against the yen, with EUR/GBP down 0.16% at 0.8614 and GBP/JPY up 1.05% at 153.06.

On Friday, the U.K. is to release government data on public sector net borrowing.