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GBP/USD daily graph
Why has the GBP/USD lost ground?
Today's move has been largely down to the U.S. dollar strengthening. Investors seem to be banking on the Federal Reserve increasing interest rates next week, while the dollar has also gained momentum due to the developments in the French elections.
During times of uncertainty the U.S. dollar is often seen as a safe-haven for investors and that is exactly what we have seen today. Former French Prime Minister Alain Juppe, today ruled out running in the upcoming elections, which has been seen as boosting the stock of anti-EU candidate Marine Le Pen.
A poll released last week showed that if Alain Juppe replaced Francois Fillon, he would win the first round of elections with Emmanuel Macron coming in second, ending Le Pen's chances of making it through to the next round.
However, today's developments have ended that theory and following Brexit and Donald Trump, investors are acting on the side of caution and have headed to the safety of the dollar.
Are you looking to buy or sell dollars?
If you have a requirement to buy or sell dollars in the weeks or months and are worried about the impact Brexit, the Federal Reserve rate hike or the French elections could have on your transfer, contact me today for a free, no-obligation currency consultation.
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