The US Dollar continues to rally against Sterling in the wake of Brexit due to its safe haven status, it looks as though this trend could continue for some time.

Strong US economic data helps the US Dollar continue making gains against GBP

The US Dollar continued its surge against Sterling during yesterday’s trading, with a drop in jobless claims and a boost in home sales for June, mainly due to low interest rates luring in first time buyers. As a safe haven currency where investors flock to in times of global economic uncertainty, the greenback has performed incredible well against Sterling since the end of June, gaining by almost 15% in the wake of the referendum result.

To put that in to monetary terms, a $200,000 purchase would now cost you an extra £23,000 compared to before the referendum result, which highlights just how important it is to have an experienced currency broker on your side to keep you informed of all the latest market movement and the impact this has on your exchange. We have been trading for over 16 years and the average tenure of our traders is 7 years, so we are perfectly placed to help you time your currency transaction.

When will the Fed raise interest rates?

We did see a brief spike for USD buyers earlier this month, with the Fed keeping interest rates on hold at their latest interest rate decision. There was expected to be 4 interest rate hikes this year following their first in December, but since then we’ve had none and according to a Reuters poll yesterday, they are not expected to hike rates again until December this year. If that’s the case, we could see some USD weakness until their general election is concluded, which may present some spikes to take advantage of for US Dollar buyers. The next interest rate decision from the Fed is on Wednesday evening. Although there is no change expected, I would expect Janet Yellen to give us some hints towards when we can expect to see a change in policy. If she is dovish, which I believe she will be, we could see a spike for USD buyers.

Thank you for reading my US Dollar currency report, if you have any questions about USD exchange rates I would be more than happy to discuss them – you can contact me with any queries at rjh@currencies.co.uk.

News

Read more articles
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.