Forex - GBP/USD pares losses after U.K. service sector data

The pound pared losses against the U.S. dollar on Wednesday, supported by data showing that service sector activity in the U.K. slowed less than expected last month, while investors eyed a string of U.S. economic reports due later in the day.

Cable was likely to find support at 1.6697, the low of April 14 and resistance at 1.6816, the high of May 28.GBP/USD pulled away from 1.6699, the pair's lowest since May 29, to hit 1.6720 during European morning trade, still down 0.18%.

Markit research group said the U.K. services purchasing managers' index slipped to 58.6 last month, from a reading of 58.7 in April. Analysts had expected the index to fall to 58.2 in May.

The data came a day after Markit said the U.K. construction PMI ticked down to 60.0 in May, from a reading of 60.8 the previous month, compared to expectations for the index to remain unchanged.

Meanwhile, the greenback remained supported after official data on Tuesday showed that U.S. factory orders rose 0.7% in April, beating expectations for a 0.5% gain, after an upwardly revised 1.5% increase in March.

Sterling was little changed against the euro, with EUR/GBP inching down 0.01% to 0.8134.

In the euro zone, Markit said Germany's services PMI fell to 56.0 in May from 56.4 in April, confounding expectations for the index to remain unchanged.

Separately, Spain's services PMI fell to 55.7 in May, from a reading of 56.5 the previous month, while Italy's services PMI rose to 51.6 last month, from 51.1 in April.

Later in the day, the U.S. was to release the ADP report on private sector job creation, as well as a report on trade balance.