On Monday the British currency rose against the U.S. dollar in quiet trade, but gains were expected to stay limited as investors locked in
profits from the dollar's recent rally against its peers.
GBP/USD hit 1.5234 during European morning trade, the session high; the pair subsequently consolidated at 1.5177, adding 0.18%. Cable was likely to find support at 1.5073, the low of January 16 and resistance at 1.5269, the high of January 15. The dollar remained broadly supported after the Swiss National Bank abandoned its three-year old 1.20 per euro exchange rate cap in a shock move last Thursday.
Sterling was lower against the euro, with EUR/GBP gaining 0.35% to 0.7661. The euro sentiment remained vulnerable amid growing expectations that the European Central Bank will launch a government bond-buying program at its meeting on Thursday, in a bid to stave off the threat of deflation in the euro area.
Moreover, the University of Michigan said, in a preliminary report on Friday, that its consumer sentiment index rose to a 11-year high of 98.2 this month from 93.6 in December, compared to expectations for a rise to 94.1.
Last week the pound had come under pressure after data indicated that the annual rate of consumer inflation in the U.K. slowed to 0.5% last month from 1.0% in November.
The slowdown in inflation drove expectations that the Bank of England will keep interest rates on hold at record lows for most of this year.
