It has been a tremendous start to the month for Dollar exchange rates as well-timed manufacturing data coupled with political turmoil in Europe allowed the Greenback to further cement its position as the market favourite. Today's Dollar report discusses how international political turmoil can strengthen USD as a safe haven currency. The table below shows the range of exchange rates during the past week, and the difference in Dollars you could have acheived when selling £200,000.00 during that time frame.
|Currency Pair||% Change||Difference on £200,000|
The ISM manufacturing index rose to 60.2 from 58.7 suggesting this year’s expansion in the sector is showing no signs of slowing down. The release came out in clear contrast to the equivalent release in Europe which showed a considerable slow down amidst the clouded political scene in Germany.
As a result, it has been an easy decision for investors this week with the markets well and truly in the Dollar’s corner. The greenback has already recovered nearly 40% of last Friday’s 1% loss against the Euro and has sunk Cable rates by 0.45% to hit the low 1.31. That’s a difference of $1,800 less on a £200,000 transfer and just shows the importance of regularly highlighting your requirements to your account manager so you can best be kept up to speed to the latest trends.
Looking ahead, the second half of this week is extremely data heavy with the majority looking likely to benefit dollar holders further. More Manufacturing data is due out on Thursday whilst major employment figures are due on Friday. Given the consistent run in both areas since the end of last year I expect the Dollar to be even more expensive as the week comes to a close.
If you are looking to buy Dollars short term, this afternoon’s Factory Order numbers may well be your last chance to maximise your return before the markets move against you. We have already seen how the ongoing trade threats have hampered factory orders in Europe this week and there is every chance we could see a similar story state side too.
It will certainly be interesting to see how Trump reacts to the warnings of retaliation to the trade threats by the European Commission and the US chambers of Commerce. Both have issued clear reports outlining the potential cost to the US economy long term. Just how the Trump administration respond to this and justify the cost to the final consumer remains to be seen.
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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