This report will examine the factors that could affect exchange rates this week in order to help you stay informed if you need to make a currency transfer. The table below shows the difference you would have received when buying £200,000 at the high compared to the low for the past month.
|Currency Pair||% Change||Difference on £200,000|
GBPUSD rates have climbed this last week gaining buy over 1.3%, adding $3,650 to every £200,000 transfer. This improvement has been seen from Sterling gains rather than any real USD weakness as data from the US has recently been rather slim. Yesterday the USD gained slightly on news that existing home sales have climbed yet again in the US beating expectation.
Today’s focus in the US is on durable goods orders and the FOMC minutes. Speculation is really building now that the US will raise interest rates at their next meeting in December which, if confirmed, is likely to make the USD more valuable and expensive to buy.
One of the US Federal Reserve’s most dovish members this week also said he is “actively considering” another rate rise next month, thanks to a tight labour market. Janet Yellen warned only recently that investors were asking for more certainty on the path of interest rates than central banks were willing to give them. This I think is more pointed towards future interest rate hikes following President Trump’s nomination for Janet Yellen’s replacement in the New Year. This being Jerome Powell who is expected to be more focussed on changing regulations on the financial sector in the US rather than interest rates.
Tomorrow is a bank holiday in the US with Thanksgiving and the US ends the week on Friday with manufacturing data released on Friday afternoon. I personally expect the USD to gain in value this week making things more expensive to buy. I expect more retail sales figures to be broken in the coming days with Amazon, Ebay and WallMart likely to be the biggest. This in turn could easily result in USD strength as we end the week.
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