The US Dollar reached its best level against the Pound yesterday morning since July 2017, however then went on to lose ground against both the Pound and Euro during the course of yesterday afternoon. The reasons for this volatility are covered in today's USD report, and the table below shows the range of rates for cable during the past month demonstrating the importance of timing your transfer well.

Currency Pair% ChangeDifference on £200,000
GBPUSD4.2%$10,690

This dip experienced by the Dollar can mostly be attributed to the financial crisis in Turkey appearing to settle down after the announcement that Qatar would invest $15 billion into the Turkish economy.

Asides from this minor weakness, the US Dollar has been performing remarkably well against a wide range of currencies including the Euro and Pound lately, which was reiterated yesterday by Donald Trump when he tweeted ‘Money is pouring into the cherished DOLLAR like rarely before’. This was just after the Dollar reached a 14 month high against a basket of currencies the day before, and this strength had been assisted by the collapse of the Turkish Lira, as investors moved their funds into the safer haven USD.

Trade wars a concern however US interest rates continue to impress

Polls suggest 96% chance of FED hiking Interest Rates in September

The US economy grew by an annualised rate of 4.1% from April-June which was almost double that of the first quarter, and forecasts are for this to continue at over 3% from July to September.

The US has enjoyed another positive run of US economic data this week, including strong US Retail Sales figures, Manufacturing data and far better than expected Initial and Continuing Jobless Claims released yesterday, and according to polls there is now a 96% chance of the FED hiking rates for the third time this year at their next meeting on 26th September.

On Wednesday evening, the minutes from the latest FED Interest Rate decision meeting on 1st August will be released and will likely provide an insight into the decision behind keeping interest rates on hold at 2%, and may give further suggestion towards a hike in September. If this is the case I would expect the US Dollar to strengthen once again, and we could see Cable rates test the 1.25 mark which hasn’t been seen since April 2017. Clients needing to purchase US Dollars in the short to medium term may be wise to trade sooner rather than later to limit any further potential losses.

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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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.