The US Dollar has been losing value vs the Pound since hitting its annual high on the 2nd of January this year. Since the Pound to US Dollar rate hit that level of 1.2442, the Pound has gradually climbed and yesterday afternoon the pair hit a 6-week high of 1.3080 at its highest level.

Currency Pair% Change in 1 monthDifference on £200,000

The Pound has been boosted owing to hopes of an extension to Article 50 as covered earlier in the Sterling section of this report.

The US Dollar on the other hand has been coming under pressure as the US Government shutdown has now reached a record of 32-days, which the longest shutdown in US Governmental history. A number of prominent US celebrities, including Snoop Dogg (US rap musician) have offered their opinions on this matter, although I won’t repeat what he said.

US Dollar Remains Stable vs the Pound

There’s a chance the stalemate between the Republicans and the Democrats could see a breakthrough this week as there will be votes in the US Senate on two proposals aimed at ending the shutdown.

President Trump backs one of them as it will allow funding for the proposed border wall, whereas the other doesn’t and this could be the sticking point. Both would allow for temporary funding for Government workers as many have now gone unpaid for some considerable time.

If there is a breakthrough, I think we can expect to see the US Dollar climb but if the issue continues I think it’s likely to impact the US economy and therefore, the US Dollar.

Jobless data to take centre stage this afternoon

This afternoon at 1.30pm UK time there will be Continuing and Jobless Claims released which could move the markets. December's figure was 213k new jobs and the expectation for January’s is 220k so any large deviations from this consensus is likely to result in price changes. Do feel free to get in touch if you wish to plan around these releases.

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