Forex - Pound edges lower vs. dollar in quiet trade

The pound edged lower against the dollar in quiet trade on Monday as expectations that the Federal Reserve will put off plans to start reducing stimulus continued to weigh on the dollar.

GBP/USD hit 1.6156 during European afternoon trade, the session low; the pair subsequently consolidated at 1.6158, edging down 0.07%.

Cable was likely to find support at 1.6114, the low of October 22 and resistance at 1.6255, the high of October 23.

The U.S. was to release data on industrial production and pending home sales later Monday. 

Market participants were also looking ahead to the Fed’s upcoming policy meeting later in the week after recent disappointing economic data cemented expectations that the central bank will maintain the current pace of its asset purchase program into the first quarter of next year.

Data on Friday showed that an index of U.S. consumer sentiment was revised down to a 10-month low in October on concerns over the economic impact of the recent 16-day government shutdown.

The pound had little reaction after a report compiled by the Confederation of British Industry said just 2% of retailers reported an increase in sales in October, down from 34% in September. 

Demand for sterling continued to be underpinned after data on Friday showed that the U.K. economy grew at the fastest pace in three years in the third quarter.

The Office of National Statistics said the U.K. economy expanded by 0.8% in the three months to September and grew 1.5% on a year-over-year basis.

Elsewhere, sterling was almost unchanged against the euro, withEUR/GBP dipping 0.04% to 0.8534.