Good afternoon,
It has been very quite in terms of economic data releases today with nothing of note coming out of the UK, U.S or the Eurozone. The lack of data did not stop the dollar though with the greenback managing to gain almost half a cent against the pound. As markets opened this morning GBP/USD was trading close to $1.6830 but by the middle of the afternoon cable had dropped back under $1.68 reaching a low of $1.6784.
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So why has the dollars value increased?
The dollar seems have carried over the momentum it built up at the back end of last week following the positive U.S. non-farm payroll numbers that were released on Friday afternoon. Although the number of 217K just missed target it is the fourth month is a row that U.S have created over 200,000 jobs in a month and adds to speculation that the U.S. economic recovery is back on track.
This will come as a huge boost for Janet Yellen and the U.S. Federal Reserve following the disastrous GDP figures that the U.S. posted last month. With the economy seemingly back on track it may give Janet Yellen the extra support she was looking for as she attempts to wind up their current stimulus package as quickly as possible.
What to look out for this week.
There are a number of key releases out of UK and U.S. as the week progresses. From the UK will see the latest manufacturing and unemployment numbers along with NIESR GDP estimate and speeches from Bank of England governor Mark Carney and deputy governor Ben Broadbent. The U.S. will provide us with their latest retail sales and weekly unemployment count and towards the end of the week the latest producer price index (PPI) figures.
All of the above have the potential to swing GBP/USD in either direction and I will of course keep you updated of any developments. In the meantime if you are thinking of buying or selling dollars and want to ensure you are making the most from your transfer, use the link below to complete the contact form or call me directly on 0044 (0) 1442 892 065.
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