The USD has continued to strengthen agains the Pound, following the raft of neative data seen from the UK yesterday. The meeting that took place in the early hours of this morning between President Trump and Kim Jong Un has also been a source of support for the US Dollar. The table below shows the difference in USD you could have achieved when buying £200,000.00 during the high and low points of the past month.
|Currency Pair||% Change||Difference on £200,000|
The US Dollar has, on the whole, been strengthening against the Pound since mid April (when GBP/EUR was at $1.43), and yesterday was no exception with GBP/USD exchange rates slipping back towards the lows seen at the end of May, hitting $1.335 yesterday morning. This was due to a host of negative UK economic data releases including poor Manufacturing Production figures, the trade deficit widening to the second largest figure on record, and worse than expected GDP (Gross Domestic Product) figures, which were all announced yesterday morning. Growth figures for the first quarter of the year were also revised down to 0.1%. To put this into context, US Growth figures were last released at 2.2%.
The US Dollar held up well against its currency counterparts following from the G7 Summit which was held over the weekend, despite Donald Trump sparking yet more trade arguments with other G7 members including Canadian Prime Minister Justin Trudeau yesterday. Trump tweeted that Trudeau had been ‘dishonest and weak’ after he gave news conference saying that Canada would not be ‘pushed around’ regarding US Tariffs.
However much of the US Dollar strength will have likely been due to rising confidence that this morning’s meeting between Trump and Kim Jong Un would help to stabilise US/North Korea nuclear tensions.
President Donald Trump and Kim Jong Un met overnight in Singapore and have signed a ‘comprehensive’ document regarding the denuclearisation of the Korean Peninsula. At this stage we have no further information on what was included in the document, however in a press conference afterwards, Trump said that ‘the world will see a major change’. The US Dollar has strengthened this morning against all of its currency counterparts as this is viewed as a huge step towards calming global tensions. Get in touch with us this morning to take advantage of these attractive levels to sell US Dollars.
There is a host of factors to impact GBP/USD exchange rates over the coming days, as highlighted in my Sterling section of this report. Not only this, but US Inflation figures will be released this afternoon at 12.30pm and are expected to improve in May from the previous month. The Federal Reserve take Inflation as a key barometer when deciding on Interest Rate policy changes, so if this is positive as expected it could bolster the argument for another three hikes this year, which would in turn strengthen the US Dollar’s value.
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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