GBP/USD was down 0.20% to 1.5505 at the close of trade on Friday, down from highs of 1.5573 hit on Thursday, the highest since June 19.
Cable is likely to find support at 1.5300 and resistance at 1.5573, Thursday’s high.
The greenback regained ground but gains were limited by doubts over whether the Federal Reserve will decide to begin tapering its USD85 billion-a-month asset purchase program in September.
Comments by senior Fed officials during the week, including the heads of the Federal Reserve Banks of Chicago and Dallas, indicated that the U.S. central bank could begin to scale back its asset purchase program as early as next month if the economy continues to pick up.
In the U.K., data on Friday showed that the trade deficit narrowed to its lowest level in nearly a year in June and a separate report showed that the U.K. construction sector expanded in the second quarter, adding to signs that the recovery is gaining traction.
On Wednesday, BoE Governor Mark Carney outlined plans to keep interest rates on hold at 0.5% until the U.K. unemployment rate falls to a threshold of 7% from its current level of 7.8%, something he added is unlikely to occur for another three years.
The BoE said the unemployment threshold could be set aside if low bank rates begin to threaten financial stability or if medium term inflation forecasts rise above 2.5%.
Carney said that while an economic recovery was "taking hold" in the U.K growth was likely to be "weak by historical standards."
The bank expects the economy to expand by 0.6% in the current quarter and said that growth will reach an annual rate of 2.6% in two years' time, up from 2.2% in its last report.
In the week ahead, investors will be closely watching U.S. data on retail sales and consumer inflation, as well as reports from the housing and manufacturing sectors for indications of the strength of the economic recovery.
U.K. data on retail sales and employment will also be in focus.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.
Tuesday, August 13
The U.K. is to produce official data on consumer price inflation, which accounts for the majority of overall inflation.
Later in the day, the U.S. is to publish government data on retail sales, import prices and business inventories.
Wednesday, August 14
The U.K. is to release official data on the change in the number of people unemployed and the unemployment rate, as well as data on average earnings.
The U.S. is to release official data on producer price inflation later Wednesday.
Thursday, August 15
The U.K. is to release official data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.
The U.S. is to release a series of economic data, with reports on consumer inflation, jobless claims, industrial production and manufacturing data from the Empire state and the Philly Fed.
Friday, August 16
The U.S. is to round up the week with data on building permits, a leading indicator of future construction sector activity, as well as data on housing starts. The University of Michigan is to release its closely watched preliminary data on consumer sentiment.
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