As a result of the current unrest between Russia and the west, investors are likely to move the funds to the safe haven currency the Dollar. The table below shows the difference in USD you could have achieved when buying £200,000.00during the high and low points of the past 7 days.

Currency Pair% ChangeDifference on £200,000
Strong US data strengthens the US Dollar

Positive economic data to drive dollar fightback

With the exception of the Pound, the greenback was up against the majority of its major currency counterparts during yesterday’s trading, the US Dollar index closed the day .3% higher.

Evidently the markets reacted well to the impressive jobs market data released early yesterday afternoon. I think the timing could be pivotal for the Dollar which has been struggling to get any real kind of foothold since the start of the month. With the Federal Reserve’s next interest rate meeting set for next Wednesday evening, it goes without saying that US economic data will remain well and truly in the spotlight.

Key housing market data is due out this afternoon with the consensus forecasting a slowdown in growth. These releases have continued to come out higher than expected since the final quarter of last year however so I wouldn’t be surprised to see similar results this time round too, which could lead to the dollar becoming more expensive to buy.

Might the greenback be benefitting from the political tension?

There might also be a case for the rise in tension between Russia and the West leading investors to switch their funds towards the safer haven currencies until the ramifications become clearer. Further boosting the Dollar.

Yesterday, European and American leaders quickly sided with the UK for calls for further clarity over the Salisbury Nerve attack crisis for which Russia are yet to take responsibility. The divide was further compounded as news broke out that Russian hackers have successfully been leading cyber-attacks on key American energy corporations. Combined with the growing evidence of Russian hackers interfering with the 2016 Election, the US ended up sanctioning 19 Russians yesterday afternoon. The likelihood of Russia taking responsibility for either anytime soon remains limited so this period of uncertainty may well prompt some form of underlying US dollar value for the foreseeable future.

Despite all this I think it is worth acknowledging Sterling’s hold against the dollar throughout this week, given it remained one of the only currencies to protect its gains against the greenback. I would be surprised to see it last into the second half of next week though, with so much going on stateside. If you are looking to buy dollars it may pay to act whilst the going is good.

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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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.