The last month has been turbulent for cable rates, with movement of almost 4 cents since the start of August with the better levels testing 1.30 and lower levels dropping just below 1.27. The Dollar report below discusses the recent strength for GBP against USD and economic data coming out for the rest of the week. The following table shows the range of Sterling/US Dollar exchange rates throughout the past week, and the potential difference in returns when selling £200,000.00.
|Currency Pair||% Change||Difference on £200,000|
Sterling’s movement against the USD seems to be following a similar path to that with its EUR paring, with best rates this year experienced in April and since then a steady decline to the current levels which are fluctuating at the lowest since last September.
However, yesterday afternoon’s sudden spike in Sterling sentiment did see favourable movement against the USD of almost 1 cent, which suggests that despite the current strength of the Greenback, there are opportunities to gain ground and as the UK’s position surrounding Brexit becomes clearer and if pressures are eased, Sterling has the potential for further growth.
In the short term however, I would expect the USD to remain in high demand as global trade uncertainty affects global markets and as such, investment into the safe-haven currency continues to be a viable option.
From midday, there will be various US employment and industry economic data releases which could see consequent USD movement going into the afternoon. Markit Services PMI data is expected to show continued expansion on last months, whilst jobless data is expected to show a slight increase.
Non-farm Payroll data is released on Friday and is typically a market mover. The figure is expected to remain bullish with an increase of approximately 190k new jobs created in the last month.
If results go as expected, USD buyers could benefit by acting sooner rather than later as Dollars could become more expensive to buy going into the weekend.
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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