Good morning,
The past twenty four hours have been extremely volatile for GBP/USD exchange rates, with the currency pair moving within a near four cent range. Yesterday evenings statement from the U.S. Federal Reserve caused chaos on the currency markets and have shown once again just how unpredictable things can be.
For a free currency consultation click here.
At 4pm yesterday the GBP/USD cross was sitting around $1.4650 but following the announcement by FED Chair Janet Yellen, exchange rates climbed to briefly break the $1.51 barrier before slipping back to $1.48 at the start of today's session.
To put the move into monetary terms, converting £200,000 would have seen a difference of around $8,500 between the high and the low of yesterday's session and underlines just how important it is to get the timing right on your transfer.
What did the FED say?
During yesterday's statement the Federal Reserve changed its stance on interest rates following their two day meeting. Interest rates in the U.S. have been at 0% since the 2008 financial crisis and there had been suggestions that Mrs Yellen could give an indication as to when the central bank will raise the bench mark level.... that didn't happen!
They FED did remove the word "patience" from their statement, the key word that has been used in recent months as an indication the bank would not be raising rates in the foreseeable future. However, Mrs Yellen went on to say the central bank would not be "impatient" and that "further improvement" was needed in the labor market before raising interest rates.
So why did this weaken the dollar?
Some investors had been hoping for a rate rise as early as June and it seems this had been priced into the market. With the FED holding off for the time being, the value of the dollar has been corrected and allowed the pound to claw back some of the ground it has lost over the past couple of weeks.
Get in touch
With Sterling set for a volatile few weeks in the run up to UK elections it is important to know what options you have in order to make the most from your transfer. As a specialist currency broker I have a number of contract options available to help protect you against adverse market movements or target a rate that might not be currently available.
For more information on the different ways to purchase your currency or to find out what rate of exchange I can offer, use the link below to complete the contact form or call me directly on 0044 (0) 1442 892 065.
Click here to complete the contact form.
