Thursday, 23 March 2017

Pound hits one month high against the dollar

Today has seen the pound rise to its highest levels against the U.S. dollar since the 24th February, with the currency pair hitting $1.2527 this afternoon.

For the best GBP/USD exchange rates click here.


The pound received a huge boost this morning after the latest retails sales figures smashed the predicted level of 0.4%, coming in at 1.4%, helping sterling to rise across the board.

GBP/USD graph





With concerns mounting over Article 50 being triggered next week and the impact it will have on the value of the pound, today's retail figures will give investors some extra confidence and once again show the UK economy's resilient side.

Next week will lead us into the unknown and it is almost impossible to predict what will happen in the FX markets.

Some forecasts are suggesting the pound will lose ground the moment Article 50 is triggered and that we could see GBP/USD drop below $1.20.

Others are saying that once Article 50 in invoked it will provide some clarity for the markets and could give the pound a boost.

My opinion is somewhere in the middle. I think Article 50 has already been priced into the value of the pound so I doubt we will see the pound plummet. I do think it will provide some clarity for investors but it is unlikely the pound will rise on the back of it.

We have known for months that Article 50 will be triggered at the end of March and we also know Theresa May will push ahead with a "hard" Brexit. Unless we are thrown a curve ball between now and Wednesday, Article 50 is not going to come as a surprise so there is a chance it will actually have very little impact on the pound or FX market.

 

Do you need to buy or sell dollars?


If you have a requirement to buy or sell dollars in the coming weeks and are worried about the impact Article 50 could have on your transfer, contact me today for a free, no-obligation currency consultation.

For more information about how I can help or to find out what rate of exchange I can offer complete the contact form by clicking on the link below.

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Wednesday, 22 March 2017

GBP/USD exchange rate falls

After rising to $1.25 in the early hours of this morning the GBP/USD cross fell almost three quarters of cent to leave the currency pair trading around $1.2430.

For the best GBP/USD exchange rates click here.


As I mentioned in my post yesterday, the pound surged following the latest round of inflation figures. With inflation pushing above the Bank of England's target of 2%, expectations of a rate hike in the near future had been increasing.

Last week the Bank of England meeting minutes showed one member of the Monetary Policy Committee had voted for an immediate rate hike, while others were sitting on the fence and ready to act if needed.

However, the pound has been unable to hold onto the gains as many now think the Bank of England were simply taking a hawkish stance in the build up to Article 50 being triggered and to address the decline in consumer sentiment and spending.

GBP/USD graph.


 
 

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If you have a requirement to buy or sell dollars in the coming weeks and want to ensure you are making the most from your transfer, contact me today for a free, no-obligation currency consultation.

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Tuesday, 21 March 2017

Why has the pound risen against the dollar this morning?

This morning has seen the pound surge across the board after the latest round of inflation figures
were released at 0930 (GMT).

For the best GBP/USD exchange rates click here.


Markets had been expecting the UK inflation figure to rise from 1.8% to 2.1%, but with the actual reading coming in at 2.3% it has given the pound a much needed boost following yesterday's drop.

As you can see from the graph below the GBP/USD cross has risen over a cent so far today, with the currency pair climbing from $1.2342 to its current level of $1.2459.

GBP/USD graph




Figures released by the Office for National Statistics (ONS) confirmed inflation had risen to 2.3% last month, up from 1.8% in January, with the ONS stating that rising food prices and fuel were the major drivers in pushing the inflation reading higher.

The inflation rate is at the highest we have seen since September 2013 and takes us past the Bank of England's 2% target level. Inflation levels in the UK have been climbing after Junes referendum result caused the pounds value to fall, which in turn made imported goods more expensive to buy.

This morning's news will back up MPC member Kristen Forbes recent calls for an interest rate hike in the near future, and if  Bank of England governor Mark Carney drops any hints over monetary policy when he speaks in half an hour (1030 GMT),  we could see the pound rise even further over the course of today.

Do you need to buy or sell dollars?


If you have a requirement to buy or sell dollars in the coming weeks and want to ensure you are making the most from your transfer, contact me today for a free, no-obligation currency consultation.

For more information about how I can help or to find out what rate of exchange I can offer complete the contact form by click on the link below.

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Monday, 20 March 2017

Sterling unable to hold onto gains

After climbing back above $1.24 for the first time since the 28th February this morning, the GBP/USD cross lost ground during this afternoon with the currency pair falling back below $1.2350.

With no major economic data being released from the UK or the United States today, it would seem markets have reacted to the news that Prime Minster Theresa May plans to trigger Article 50 on the 29th March.

A spokesperson from Downing Street confirmed earlier today that May would write a letter to the European Council to officially notify the EU the UK is leaving, and hoped negotiations on the terms of future relations and the terms of the UK's exit could begin as quickly as possible.

GBP/USD graph



It is still unclear what impact Article 50 will have on the pound once it is triggered. Although it is probably safe to say it will spark some heightened volatility for all sterling crosses.

Will we see the pound rise or fall on the back of Article 50?


It depends if it has been priced into the value of the pound and how markets view it. We have known for months that Theresa May planned to trigger Article 50 by the end of March and we have also known that she plans to give up access to the single market, so it should not come as a huge shock to everyone.

If the invoking of Article 50 has been priced into the pounds value it could be a bit of a non-event. There is also an argument to say that once triggered, it will remove some of the uncertainly that has been dragging down the pound and provide markets with some much need clarity.

 

Do you need to buy or sell dollars?


If you have a requirement to buy or sell dollars in the coming weeks and are worried about the impact Article 50 could have on your transfer, contact me today for a free, no-obligation currency consultation.

For more information about how I can help or to find out what rate of exchange I can offer complete the contact form by clicking on the link below.

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Friday, 17 March 2017

GBP/USD hits $1.24


Good afternoon,

The GBP/USD cross jumped to $1.24 this morning, after the dollar continued to lose ground following the Federal Reserve announcement on Wednesday evening.

For the best GBP/USD exchange rates click here.


After falling to a fresh eight week low on Tuesday, the pound looks set to end the week around two per cent higher which will come as welcome news for the those of you looking to purchase U.S. dollars.

GBP/USD graph





Why has the dollar the weakened?


Despite the Federal Reserve raising interest rates on Wednesday, the dollar has lost ground across the board after investors were left disappointed.

When the Federal Reserve increased interest rates in December they stated they will look to raise rates three times in 2017. Since then the U.S. economy has been performing far better than many had expected and markets started to bet on the possibility of even more hikes over the course of the year, which is one of the reasons the dollar had been climbing in recent weeks.

However, those same investors have been left licking their wounds after the Fed said they remained on course for increasing rates three times this year.

Do you need to buy or sell dollars?


If you have a requirement to buy or sell dollars in the week's and want to ensure you are making the most from your transfer,contact me today for a free, no-obligation currency consultation.

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Wednesday, 15 March 2017

The pound gains against the dollar, but for how long?

Today has seen the pound move off of the eight week low we witnessed yesterday, with
the GBP/USD cross rising to $1.2250 in the early hours of this morning.

Looking for the best GBP/USD exchange rate? Click here.


The pound received a boost after Britain's Scottish minister David Mundell stated it would be impossible to have a decisive and legal independence referendum in Scotland in the timeframe laid out by Nationalist First Minister Nicola Sturgeon.

As I mentioned in one of my previous posts, Sturgeon wanted a second referendum to be held in Autumn of 2018 or Spring 2019. However, Mundell told Scotland's Herald newspaper that "It would be impossible for people in the timescale suggested by Nicola Sturgeon to make a reasoned view, and therefore, have a legal, fair and decisive referendum.

GBP/USD graph




Can the pound hold onto the gains?


The next couple of hours could bring some heightened volatility for the GBP/USD cross. At 1800 (GMT) the Federal Reserve will announce their latest interest rate decision, which will be followed at 1830 by a statement from Fed Chair Janet Yellen.

It is widely expected the Federal Reserve will announce another rate hike this evening. In my opinion the rate rise has probably been priced into the price of the dollar already, and if we are to see any reaction in the currency markets it will come during Yellens speech.

Investors will be listening closely for clues about the pace of future hikes, and if Ms Yellen hints at raising interest rates quickly then we could see the dollar benefit from increased investment flows in to the U.S.

Do you need to buy or sell dollars?


If you have a requirement to buy or sell dollars in the week's and are worried about the impact the Federal Reserve interest rate decision could have on your transfer, contact me today for a free, no-obligation currency consultation.

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Tuesday, 14 March 2017

Pound drops against the dollar again. GBP/USD at fresh eight week low.

This morning has seen the pound give up the ground it made against the dollar during yesterday's session, with the GBP/USD cross falling to a fresh eight week low of $1.2111.

For the best GBP/USD exchange rate click here.


After climbing to a high of $1.2250 yesterday the pound/dollar exchange rate has dipped as investors turn their attention back to the U.S. dollar, ahead of tomorrow's Dutch elections and the Federal Reserve interest rate decision.

With the dollar strengthening the EUR/USD cross has also fallen, with the currency pair dropping almost half a cent to currently sit at $1.0629.

GBP/USD twenty-four hour graph.



 

Will the dollar strengthen further if the Federal Reserve raise interest rates again?


We could potentially see further gains for the dollar tomorrow evening if Fed Chair Janet Yellen announces another interest rate hike. In theory a rate hike will usually increase the value of the country's currency due to the higher return on investors' funds.

However, the markets have been banking on the Federal Reserve tightening monetary policy for a couple of weeks now, so it is likely the rate increase has already been priced into the value of the dollar.

That's not to say we won't see any movement for the GBP/USD cross tomorrow. If Chair Yellen is positive over at the pace of future hikes, the dollar could benefit from increased investment flows into the U.S which would result in the pound losing more ground against its American counterpart.

Do you need to buy or sell dollars?


If you have a requirement to buy or sell dollars in the week's and are worried about the impact the Federal Reserve or the Dutch elections could have on your transfer, contact me today for a free, no-obligation currency consultation.

For more information about how I can help or to find out what rate of exchange I can offer complete the contact form by clicking on the link below.

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