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by ForexNewsNow Team on October 7, 2010

GBP/USD retreats from 8-month high, erasing BoE-fueled gains

GBPUSD analysis - BoE chief KingNEW YORK (Forex News Now) – Sterling retreated from an 8-month high against the dollar on Thursday, erasing gains made on the back of an interest rate decision by the Bank of England, following upbeat U.S. jobs data.

In New York afternoon currency market trading, GBP/USD hit 1.5845, down 0.29 percent on the day, after retreating from 1.6018, its highest since Feb. 3.

Both the Bank of England and the European Central Bank held their benchmark interest rates steady, as widely expected. The BoE also maintained its bond-purchasing program, known as quantitative easing, and under which it had injected about GBP 200 billion pounds into the U.K. economy.

According to GBP USD analysis, cable was likely to touch support around Wednesday’s low, 1.5751, and encounter immediate resistance around the daily high, 1.6018.

Also Thursday, the U.S. Labor Department said earlier that there were a seasonally adjusted 445,000 initial jobless claims last week, after an upwardly revised 456,000 during the previous week. Analysts had expected a more modest drop in claims to 454,000 last week, two currency market trading news outlets reported.

Elsewhere, sterling slumped versus the yen: GBP/JPY traded at 130.58, down 0.92 percent, according to intraday analysis.

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