It has been a relatively quite day in terms of economic releases, with no data from at all coming from the UK, U.S. or Eurozone. That being said Sterling still managed to climb back over $1.66 this afternoon following a late rally from the dollar on Friday afternoon which saw GBP/USD exchange slip back to $1.6570.
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Over the last couple of weeks the GBP/USD cross has remained relatively flat, in fact, since 25th March Cable has been trading between $1.65 and $1.66. The UK economy as been growing steadily, though the recovery has slowed in recent weeks, meanwhile, the U.S. are still failing to deliver a string of positive data releases and this was highlighted on Friday by the weaker then expected job numbers.
Based on the recent results it is hard to see when and how the dollar will find the strength to fight back. As I have said before the dollar lost around 13% against the pound in the last nine months and unless things improve quickly I cannot see rates pushing back towards $1.60 anytime soon.
Even last months efforts by the FED failed to leave a lasting impression, another round of tapering and talk of a rise in interest rates helped the dollar for all of about 48 hours before the pound managed to recover.
It will be interesting to see how the FED approach monetary policy when they meet again towards the end of the month. Could the FED announce another cut to stimulus and be give a clearer indication of when a rise in rates may take place? Lets hope so, as the last few months have not been the best for anyone looking to sell the U.S dollar.
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