Foreign exchange - Pound rises off Eight-month trough vs. greenback

© Reuters. Pound gains ground vs. greenback as markets digest Fed rate decision

Investing.com – The pound rose against the U.S. dollar on Friday, easing off an eight-month low as investors digested the Federal Reserve’s decision to raise interest rates on Wednesday.

hit 1.4950 during European morning trade, the session high; the pair subsequently consolidated at 1.4934, rising 0.21%.

Cable was likely to find support at 1.4861, Thursday’s low and an eight-month low and resistance at 1.5003, Thursday’s high.

The dollar had strengthened broadly after the Fed raised interest rates by a quarter of a percentage point to between 0.25% and 0.50% at the conclusion of its two-day policy meeting on Wednesday. It was the first rate hike in the U.S. since 2006.

Commenting on the decision, Fed Chair Janet Yellen said that further rate hikes would be gradual and data dependent.

Adding to optimism over the strength of the U.S. economy, the Department of Labor said on Thursday that in the week ending December 11 decreased by 11,000 to 271,000 from the previous week’s total of 282,000.

Analysts expected jobless claims to fall by 7,000 to 275,000 last week.

Meanwhile, the pound remained mildly supported after the U.K. Office for National Statistics reported on Thursday that increased by 1.7% last month, blowing past forecasts for a gain of 0.5%.

Year-on-year, rose at a rate of 5.0% in November, easily surpassing expectations for a 3.0% gain.

Sterling was also higher against the euro, with slipping 0.17% to 0.7250.

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Foreign exchange - Pound rises off Eight-month trough vs. greenback