The Pound to US Dollar rate has struggled to break the 1.30 mark, but how long can President Trump test the patients of the markets? The below table shows GBP/USD exchange rate movements within the last 30 days.
|Currency Pair||% Change||Difference on £200,000|
In my view, I feel we may see USD volatility for some time to come due to the erratic approach we are seeing from President Trump. Only last week we saw his recent outburst in the surprise sacking of James Comey - FBI director. Trump has strongly advised Comey not to talk to the worldwide media and warned him about future action if he does decide to break his silence. With this just being the latest outburst from Trump its causing currency markets to have the jitters.
In my personal opinion, I feel the 1.30 mark is a matter of when and not if. With Trump's continued outrageous comments and behaviour causing USD weakness I feel the Pound could break the 1.30 mark in the coming weeks.
At the time of writing GBP/USD rates are sat at 1.2903 which are extremely close to a six-month high within the market for this currency pairing. With continued perceived strength for Sterling in terms of the build-up to the election and Trump's continued outlandish comments this is a perfect cocktail to see rates break 1.30 in the imminent future.
The week ahead is fairly quiet for the US Dollar, however this afternoon we have the Housing Market Index data, Thursday sees Jobless Claims Data, and on Friday a member of the Federal reserve is speaking and any mention of an interest rate change will be key. So far this year we have seen in one interest rate hike and with Janet Yellen announcing earlier this year she wished for four interest rate hikes throughout 2017. Watch this space carefully on Friday.
Further developments in the Trump/Comey case has the potential to greatly impact the US Dollar. We offer a number of contract options at Foreign Currency Direct to help mitigate risk during volatile market conditions. Call us on 01494 725353 if you'd like to learn more about this.
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