GBP USD analysis: Sterling rises after Osborne benefits speech

NEW YORK (Forex News Now) – Sterling rose against the dollar on Monday, after George Osborne, Britain’s Chancellor of the Exchequer, announced at the Conservative party conference a cap in welfare benefits for families.

In late U.S. currency market trading, GBP/USD hit 1.5833, up 0.07 percent on the day.

Osborne said: “For the first time, we will introduce a limit on the total amount of benefit any one family can receive. The limit will be set according to this very simple principle: Unless they have disabilities to cope with, no family should get more from living on benefits than the average family gets from going out to work.

The Chancellor’s comments came as British civil servants and ministers prepare to drastically cut most categories of government spending to help close Britain’s huge budget deficit

According to GBP USD analysis, cable was likely to touch support around last Thursday’s low, 1.5669, and encounter immediate resistance around the high of Aug. 6, 1.5998.

Sterling’s gains also came after an industry report showed that pending sales of previously owned home in the United States grew more than expected in August.

Elsewhere, the pound jumped versus the euro: EUR/GBP traded at 0.8643, down 0.86 percent, according to intraday analysis.