Trump's trade tariffs, as well as his vocal stance on the situation developing in Syria have put pressure on the US Dollar which has previously been performing well. This report looks at the the factors likely to affect USD in the coming months; and the table below shows the difference in Dollars you could have achieved when buying £200,000.00 during the high and low points of the past month.
|Currency Pair||% Change||Difference on £200,000|
Yesterday was no different when he jumped on America’s tax day to claim that the reforms he put forward had boosted the US economy, claiming “Americans are winning again”.
Whilst his various outlandish tweets are nothing new, there is no arguing that his internalisation and US protectionism has certainly benefitted the US economy, which has been predicted to grow throughout 2018.
This positivity surrounding the economy had certainly helped support the USD against the majority of major currencies, or at least this was the case up until recently.
The USD has seen its value diminish recently, particularly against the Pound, which put pressure on 1.44 during yesterday’s trading.
Although the greenback found support around this level, it seems unlikely to make a move back towards 1.40 over the coming days.
Sterling has been supported, as discussed earlier in this report, by a strong run of UK economic data and progress with Brexit talks. This combined with Trump’s worrying and proactive stance on the Middle East, as depicted by his tweets regarding going to war with Syria, along with his potentially destabilising trade tariffs, could have devastating consequences on the global markets. This seems to have sapped investor confidence to some extent, with investors’ concerns meaning they have pulled funds away from the USD.
Even Trump's internalisation of US goods and services has been predicted to have a longer-term negative impact on US sectors such as agriculture, which relies heavily on the export of its soy beans to China as a prime example.
Whilst Trumps business prowess may have helped the US make “a quick buck”, shouldn’t the leader of the free world have a wider, more empathetic stance on global matters?
Either way it seems as though the US economy will continue to post positive numbers but whether the USD is able to strengthen in line with these figures, is debatable based on its recent downturn.
For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.
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