Good afternoon,
Since my last post things have gone from bad to worse for the GBP/USD cross. Since the 19th September sterling/dollar has dropped from $1.6487 to $1.5956 the lowest we have seen the currency pair for over a year.
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What has caused the drop?
The recent decline for GBP/USD is mainly down to dollar strength rather than sterling weakness. While cable has dropping the pound has actually been gaining against most of the other major currencies, GBP/EUR is close to its highest level in six years!
The U.S. dollar has benefitted in recent weeks from a number of positive comments from the Federal Reserve and better than forecast economic numbers. The Federal Reserve have announced their stimulus package will be wound up by the end of October, which has helped strengthen the greenback and also switch the focus to a potential interest rate hike.
The U.S. economy has also seen an upturn over the last few months, last week's jobs numbers are a prime example of how the economy seems to have turned a corner. On Friday figures showed 248,000 jobs were created in September, the 5th time in six months the figure has been over 200,000 and with other sectors also performing well it seems as the dollar's gains could be here to stay.
I am not the only one to have this line of thought, one of the forecasts I received this morning showed the GBP/USD cross could be as low as $1.57 within the next twelve months, despite a potential interest rate hike from the Bank of England coming in the next few months.
If you have an upcoming requirement to buy or sell dollars and want to ensure you are making the most from your transfer it is important to know what tools are available. As a specialist currency broker I can help protect you against adverse market movements or target a rate that might not be currently available.
For more information use the link below to complete the contact form or call me directly on 0044 (0) 1442 892 065.
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