This USD update examines factors that could affect exchange rates in the coming weeks, the below table shows the difference in USD you would have achieved when buying £200,000.00 during the high and low points of the past month.
|Currency Pair||% Change||Difference on £200,000|
Last week the US dollar came under pressure against all of the major currencies as the latest minutes hinted that an interest rate hike isn’t certain as many investors had first thought. The economic data releases to look out for this week which could have an impact on the Federal Reserve’s decision on the 13th December are Annualized GDP numbers on Wednesday at 1:30pm and Core Personal Consumption Expenditure at 1:30pm Thursday. Both releases are set to show a slight improvement which should help the US dollar however Chair Janet Yellen has also exclaimed the inflation numbers that are set to be released on the same day as the interest rate decision could be the deciding factor to whether an interest rate hike will occur.
Economic data releases as always will drive exchange rates but the main focus this week I believe will be when Fed Chair nominee Powell addresses the Senate on Wednesday. All eyes will be on the Fed Governor as investors watch eagerly, looking for any hints to how he plans to run the Fed when he is elected next year. Reports are suggesting he will follow in the footsteps of Janet Yellen in regards to monetary policy however loosen regulation. In addition Powell could announce that the Senate will vote on President Trump’s new tax system. Depending on how this is received by the markets, this could cause a volatile period for US dollar exchange rates.
In other news the Organisation of Petroleum Exporting Countries is set to meet on Thursday to discuss whether the oil cut program will continue past March. If this is the case I don’t expect this event to have a major impact on US dollar exchange rates. However if reports are released that no extension is made, I expect currency speculators will flock to the safe haven US dollar.
For more information on how future data releases could affect your US Dollar requirement, call our trading floor on 01494 725 353 or email me here.
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