Pound/Dollar update

It has been a quiet couple of days for the GBP/USD cross as a lack of data releases from the US has prompted a more stable feeling to the market compared to recent weeks.

We did see a small recovery for the dollar on the back of the announcement that Greece had their credit rating downgraded and the CBI data release in the UK which has shown Britain’s service sector is weakening. This prompted a flight to safety as investors left the UK and single currency.

Despite last week’s announcement that EU ministers agreed to bailout Greece for a second time, rating agency Standard & Poor’s have classified Greek debt as ‘selective default’ on the back of the deal made with their creditors. Greek debt already had a junk rating before yesterday’s news.

Yesterday’s CBI data release has shown Britain’s service sector has weakened, this covered the three months ending the 31^st January. In the report consumer and business services saw a drop in activity, but in both cases it was not as much as first feared.

With forecasts still showing a mixed feeling about the GBP/USD cross it’s important to make sure you have the necessary precautions in place. Depending on where you look you could see predictions for pound/dollar exchange rates ranging from 1.55 to 1.59 for the next 3 months. On a £200,000 trade could mean a difference of 8,000 dollars.

If you need to buy or sell dollars in the coming months click here to send me an email. Alternatively complete the contact form on the home page of the blog and we can discuss the options available to you in more detail.