This US Dollar report will examine the factors that could affect exchange rates in the coming weeks in order to help you stay informed if you need to make a currency transfer. The table below shows the difference you would have received when buying £200,000 at the high compared to the low during the past month.
|Currency Pair||% Change||Difference on £200,000|
Like Sterling, the USD has also found life tough-going of late.
Despite selling rates against Sterling still looking very attractive, especially when you consider the history of the pair, the USD has come under increasing pressure.
Whilst the current market instability makes forecasting particularly testing, clients holding the USD should ask themselves certain questions. Such as, do they have enough confidence in a Trump led economy, to gamble on the greenback returning closer to the 31-year high we saw against Sterling only a few months ago?
Similarly, do they feel a major upturn is likely against a buoyed Eurozone economy and a recovering EUR?
With so much controversy surrounding President Trump and the on-going Mueller investigation into Russian connection and interference with the election campaign, I cannot see investor confidence rising much over the coming days.
Investors risk appetite is likely to remain minimal until events unfold further and therefore I would be looking to protect any USD sell positions.
With the IMF also cutting US growth forecast for 2017 and Trump struggling to push through his promised tax reforms and structural investment, the greenback could be in for a rocky few weeks at least.
Looking at key data this week, the USD received a small boost yesterday, following better than expected Manufacturing & Services data. This helped to curb further losses against both GBP and the USD, despite the on-going negative reports surrounding president Trump.
Today we have a host of housing data but it is tomorrow and Friday that are likely to dominate the media and investor’s focus.
Tomorrow we see the latest US FED interest rate decision and monetary policy statement. With so much interest in the likelihood of the FED raising interest rates again and rumours that the recent economic slowdown has caused them to rethink further hikes this year, how will market developments affect the USD’s value?
Any indication of monetary policy commitments, or that the economy may require some external support over the coming months is likely to put further pressure on the USD.
Finally, on Friday we have US Gross Domestic Product (GDP) figures, which give investors perhaps the biggest insight into the health of a countries economy.
Whilst recent economic data and the on-going uncertainty surrounding prospective interest rate hikes doesn’t lead us to an overly upbeat predication, any indication of future up or downturns are likely to have a significant impact on the USD’s value and its major currency counterparts.
For more information on how future data releases could affect your USD requirement, call our trading floor on 01494 725 353 or email me here.
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