Again, this is a currency pairing that will most likely change following political developments as the week progresses but there are also numerous economic data releases from the States for the market to react to. The USD report below looks into the recent economic data releases coming out of the US that are impacting exchange rates, the table below shows the range of exchange rates throughout the past week, showing the difference in return you could have received when transferring £200,000.00 during that period.
|Currency Pair||% Change||Difference on £200,000|
Following on from fairly positive jobs data released on Friday of last week, U.S inflation will be the key economic data released over the next 48 hours.
Today we have the release of Producer Price Index data, expected to have risen ever so slightly and tomorrow we have the release of Core inflation data, which is also expected to have risen slightly from 2.2% to 2.3%.
The most recent Federal Reserve interest rate decision resulted in a hike of interest rates and also pointed towards two further rate hikes before the end of 2018.
Higher inflation may well also add fuel to the fire and should inflation have risen as expected then the Dollar may well make further gains against the Pound as the week progresses, assuming that the political picture in the U.K doesn’t totally overrule this release.
In my opinion I believe now that there is a chance of GBP/USD breaking back below the 1.30 marker, but that would be reliant on political tensions in the U.K remaining, and U.S economic data being solid.
I do however feel that as we progress towards the interest rate decision in early August we may well see Sterling fight back.
Should the U.K look to raise interest rates on 2nd August then the gap between the U.K and U.S would get smaller and the Pound may fight back for a short period, well at least until Brexit pops up again!
Bear in mind we do also have Donald Trump due to land in the U.K tomorrow and he commented yesterday that he felt the U.K was in turmoil, and that he was still brilliant friends with Boris Johnson, so be wary of any further developments here too!
If you have the need to buy or sell USD in the coming weeks then feel free to contact our trading floor on 01494 725 353 or by emailig me using firstname.lastname@example.org for an overview of the market and what is coming up in the short term that may impact your rate of exchange.
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