GBP/USD drops back below $1.70

Good afternoon,

Sterling suffered again today as investors try to predict when the Bank of England will look to raise interest rates. Following comments made by BoE governor Mark Carney yesterday and the poor UK inflation reading last week the central bank have left market players in a state of confusion which has been reflected in GBP/USD performance. Sterling/dollar hit a low $1.6953, the lowest we have seen the currency pair since 18th June.

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Despite the pound stuttering over the past week the U.S. dollar has been unable to really take advantage and the dollars value was not helped this afternoon after a worse than forecast GDP reading for Q1. Figures posted today showed the U.S. economy contracted by 2.9% in Q1, largely thanks to the extreme weather conditions. Thankfully for those of you looking to sell dollars it did not have a major impact as a contraction was already priced into the market.

All eyes will now turn to Friday and the final Q1 GDP reading for the UK, as I have mentioned in previous posts there have been reports that we could see an upward revision from 0.8% to 0.9%. If that were to happen we could easily see the GBP/USD cross back over $1.70 by the end of the week.

If you are looking to buy or sell dollars in the coming weeks or months and want to make the most from your transfer it is important to know what tools are available. As a currency broker I have a range of contract at my disposal, I can help you target a rate that might not be currently available or protect you against any adverse market movements.

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