Investing.com - The pound remained close to six-year highs against the U.S. dollar on Tuesday, after disappointing U.S data as demand for sterling strengthened broadly after data showed that growth in the U.K.’s manufacturing sector accelerated more quickly than expected in June.
GBP/USD hit 1.7155 during U.S. morning trade, the pair''s highest since October 2008; the pair subsequently consolidated at 1.7152, gaining 0.27%.
Cable was likely to find support at 1.7009, Monday''s low and resistance at 1.7200.
The Institute for Supply Management said its index of purchasing managers fell to 55.3 last month from a reading of 55.4 in May. Analysts had expected the manufacturing PMI to increase to 55.8 in June.
Earlier Tuesday, Markit said the U.K. manufacturing purchasing managers’ index rose to 57.5 last month, up from 57.0 in May. Analysts had expected the index to tick down to 56.8.
The report said new orders continued to increase on the back of stronger domestic and export demand. Meanwhile, jobs creation in the sector rose to its highest in 39 months, led by increases in small firms.
The report indicated that the U.K. economy continued to grow at a strong pace in the second quarter, fuelling expectations that the deepening recovery will prompt the Bank of England to raise interest rates before then end of this year.
Sterling was also higher against the euro, with EUR/GBP sliding 0.29% to 0.7981.
In the euro zone, data earlier indicated that the manufacturing recovery is losing momentum.
Markit''s euro zone manufacturing PMI dipped to a seven-month low of 51.8, down from 52.2 in May. Growth in the German factory sector slowed to an eight month low of 52.0, while the French manufacturing PMI fell to a six-month low of 48.2.