Investing.com - The pound edged higher against the dollar on Monday as tensions in Ukraine eased, but gains looked likely to remain limited as concerns over geopolitical risk remained in focus.
GBP/USD edged up 0.10% to 1.6788, off Friday’s low of 1.6765, the weakest level since June 11.
Cable was likely to find support at around the 1.6725 level and resistance at 1.6832, Friday’s high.
Market sentiment recovered on Monday following reports Russia ended military exercises it was holding close to the border with Ukraine, but investors were continuing to monitor developments in the region closely.
News of a fresh 72-hour ceasefire between Israel and Hamas in Gaza which came into effect on Sunday also eased concerns over geopolitical instability in the Middle East.
Sterling remained under pressure after data on Friday showed that the U.K. trade deficit unexpectedly widened in June as exports fell by 1.9%, largely due to weak demand in the euro zone.
The poor trade data overshadowed another report showing that U.K. construction output was up 1.2% in June, erasing a loss of the same amount in May.
Elsewhere Monday, sterling was higher against the euro, with EUR/GBP down 0.28% to 0.7973.
Concerns over the diverging monetary policy stance between the European Central Bank and its major peers continued to pressure the single currency lower.