Sterling slips vs dollar as Osborne prepares ground for budget

NEW YORK (Forex News Now) – Sterling slid against the dollar on Monday, giving up recent gains, as Chancellor of the Exchequer George Osborne prepared the ground for the unveiling of the annual U.K. budget on Tuesday.

In U.S. afternoon currency trading, GBP/USD was down 0.52 percent on the day at 1.4748, after falling from a daily high of 1.4936.

Osborne said earlier that the harsh spending cuts would be spread fairly across society, promising a new levy on banks and suggesting that capital gains tax will increase.

Speaking to the BBC, Osborne said he faced the toughest test of any chancellor in history to prevent Britain from embarking on a “road to ruin.”

Given the current forex analysis, cable to touch immediate support around the low of June 14, 1.4549, and encounter resistance around the high of May 10, 1.5054.

In other forex news, a government report showed on Monday that an index that covers a broad range of economic activity in Japan grew at a slower rate than expected in April.

Tuesday’s FX news is likely to be dominated by a report on German business sentiment and data on Canadian consumer price inflation.