The US Dollar has had one of its worst weeks in seven months as an improvement in equities and rising bond yields encouraged global investors to seek out risker assets. Today's USD report goes into furhter detail about the reasoning for investors moving away from the safe haven currency. The table below displays the range in cable exchange rates for the past 30 days, highlighting the importance of timing your transfer to maximise on your return.

Currency Pair% ChangeDifference on £200,000
GBPUSD2.1%$5,600
Dollar improves against the Pound but still had a difficult week

The US Dollar is often used as a safe haven currency but the change in the outlook has seen the Greenback weaken against a number of different currency pairs. Clearly the most recent Brexit news helped to improve the Dollar’s value vs the Pound but I think we could see the Dollar remain under some pressure.

Turkey has managed to mainly recover from its recent financial problems, and this has seen the Euro hit its best level to buy US Dollars since June. The Trade Wars appear to be settling down and this has also caused the US Dollar to fall in value.

Stock markets across the globe have improved to their best levels in over 6 months and it appears as though the Federal Reserve may be coming to an end with its current trend of increasing interest rates.

Fed Meeting crucial to the value of the US Dollar

The Federal Reserve are due to announce their latest interest rate decision on Wednesday, and the subsequent press conference is likely to cause a lot of movement for GBPUSD exchange rates. Another rate hike is the expectation for Wednesday’s meeting and I think this is already priced in, so I don’t expect to see much movement from the rate hike itself.

However, I think we could see a lot of volatility for the US Dollar when the press conference takes place. With the US expecting to raise rates twice before the end of the year another hike this week could see rates hit their highest level in a decade and this would be the 8th hike since December 2015.

If the Federal Reserve suggest that the rate hike cycle could be coming to an end soon, I think this has the potential to weaken the Dollar against the Pound.

Arguably the GBPUSD rate will be mainly dominated by the ongoing Brexit news, so any movement caused by the economic data in the US could be relatively limited compared to what could happen politically.

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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.