Friday, 2 June 2017

GBP/USD update and what could impact exchange rates today?

Yesterday afternoon saw the pound rise against the U.S. dollar with the currency pair climbing back above $1.29 to hit an intraday high of $1.2911. It meant the GBP/USD cross rose nearly a cent through Thursday's trading session, as investors looked past the results of the recent opinion polls and continued to side with Theresa May in the build up to next week's UK election.

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However, this morning has seen the pound edge lower against the dollar, with the cross giving up around half a cent, and is currently trading at $1.2860.

GBP/USD graph

Why has the pound fallen?

Despite rising yesterday, it would seem sterling is still being weighed down by political uncertainty. This morning saw the UK publish its latest Construction PMI figures, and even though the reading smashed forecasts (coming in at 56.00 against a prediction of 52.7) it has done very little to help strengthen the pound.

Today's Construction figures follow on from a positive Manufacturing PMI reading yesterday, and proves once again that economic data is having no impact on the UK currency at the moment.

What else could impact GBP/USD today?

This afternoon will see the U.S release their latest job report (also known as Non-Farm Payroll), and as regular readers will know the data can cause huge swings in the value of the dollar.

The report is almost impossible to predict as figures often deviate by tens of thousands from the predicted reading.

If the report is weaker than expected then we could see GBP/USD push back above $1.29 later today.

Are you thinking of buying or selling dollars?

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