GBP/USD steady in proximity to session highs

The sterling was trading with stability close to current session highs against the US dollar on Tuesday, as another upbeat string of Chinese data supported outlook over worlds second largest economy, while the greenback was still under pressure after the non-farm payrolls report out of the United States last Friday.

GBP/USD reached its highest point today at 1.5710 at 6:00 GMT, after which consolidation followed at 1.5707, gaining 0.08% on a daily basis. Support for the pair was likely to be found at September 9th low, 1.5635, while resistance was to be encountered at September 9th high and also the highest point since June 18th, 1.5731.

Market sentiment was boosted after today it became clear that Chinese industrial production rose by 10.4% in August on annual basis, outstripping preliminary estimates of a 9.9% increase and after the indicator improved by 9.7% in July. In addition, Chinese retail sales climbed 13.4% in August annually, after the 13.2% advance during the preceding month. Experts had anticipated that sales will show a 13.2% increase. These data points suggested that the second largest economy worldwide was recovering from the slow down, experienced earlier.

In the United Kingdom, The Royal Institution of Chartered Surveyors (RICS) said that prices of homes in the country reached their highest point since November 2006, implying that housing market was gaining momentum. The number of new buyers also increased. RICS house price balance rose to +40 during the three months ending in August from +36 during the three months ending in July. Price expectations heightened as well.

Meanwhile, the greenback was still under selling pressure, after on Friday the Bureau of Labor Statistics reported that US employers added 169 000 new jobs in the month of August, following the revised down 104 000 jobs in July from 162 000 previously. This raised certain doubts whether the Federal Reserve Bank will consider a scale back of its bond-buying program at its meeting on September 17-18th.

Elsewhere, the pound was gaining against the euro, with EUR/GBP cross down by 0.19% for the day to trade at 0.8432 at 10:00 GMT. GBP/JPY pair was gaining 0.64% on a daily basis to trade at 157.31 at 10:01 GMT.