US inflation levels are at a low, a FED Interest rate still looks unlikely in June and as we approach the US election we may find GBPUSD rates strengthening into the 1.50's.

Inflation improves however interest rate unlikely

Most of the hype surrounding the US in recent times is when will the US raise interest rates next? Back in December 2015 when the US hiked interest rates, Chairlady of the FED Janet Yellen, predicted 4 rate hikes would occur throughout 2016 nevertheless last month this was revised down to 2. Today at 7pm the US release their latest FOMC minutes. It will be interesting to see if there is any indication to future policy.

A worry for the FED is low US and global inflation levels. However yesterday inflation rose to 0.4% from 0.1%. However I still don’t believe this will urge the US to raise rates at their next meeting on June 15th. In fact with the Presidential Election only 6 months away and Donald Trump’s name in the hat to become President, I would be very surprised to see a hike until after the election.

For clients selling US dollar this year, I believe you have a 6 week window until cable exchange rates are back in the 1.50s and beyond. It’s important to realise the cable rates we are seeing at the moment exempt a period in February this year, are the best levels to sell dollars to buy Pounds since 2010 and it’s worth taking advantage of.

If you are looking to sell US Dollars your window of opportunity is closing, as we approach the US election we may find GBPUSD rates perk into the 1.50s. For US Dollar transfers, get in touch with our brokers today to discuss further, or email me here for more information.


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