In recent weeks GBPUSD exchange rates have dropped below 1.30 due to the Brexit uncertainty weighing on the Pound's value but also due to a strengthening US Dollar, this trend continued yesterday. The Dollar report below looks into recent and upcoming economic data, along with the support the Dollar is receiving as a result of global trade wars. The table below displays the range of exchange rates throughout the past 30 days, showing the difference in USD you could have achieved in return when selling £200,000.00, depending on the time of your transfer.
|Currency Pair||% Change||Difference on £200,000|
Reports are suggesting that investors are continuing to purchase the Greenback due to the strong US economy but also in fear of trade wars. For new readers a common trend we see in uncertain times is for investors to buy ‘safe haven’ currencies such as the US Dollar.
The latest update in regards to trade wars, is that China have retaliated with their own set of tariffs for the US which will total $60bn. Many analysts believe that if trade wars continue this will continue to benefit the US Dollar as the trade deficit will narrow and the US economy will handle a protectionism approach far better than emerging markets.
For clients involved in US Dollar transfer’s short term, the key data releases to look out for this week are Initial jobless claims, continuing jobless claims both Thursday at 12.30 and Consumer Price index numbers Friday also at 12.30.
Initial jobless claims is set to remain at a similar level to last month so I don’t expect this to have a major impact on US Dollar exchange rates if the numbers meet the expectation. However a slight rise is expected for continuing jobless claims which mean more people are unemployed within the US which is seen as a negative for the US economy.
You would expect to see the Dollar lose value after the release which could provide an opportunity for US Dollar buyers. However I expect the boost for US Dollar buyers to be short lived as the inflation numbers Friday are set to be released at 2.3% which is the same as last month, showing that the inflation numbers support further interest rate hikes, which continue to benefit US Dollar sellers.
For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.
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