It has been another positive day for GBP/USD with the currency pair climbing to its highest level since 5th March. With the U.S economy coming under increasing pressure following a run of poor economic data releases and uncertainty surrounding the upcoming UK election seemingly fading, the pound has been able to take full advantage against the safe-haven dollar.
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During today's trading session GBP/USD rose to $1.5259 and coupled with sterling's strong performance last week, the pound has now gained over 4.5% against the dollar since the 13th April when the cross was sitting at 1.4577, its lowest level since June 2010.
Will the pound continue to rise against the dollar?
As we all know the currency markets are almost impossible to predict, but in my opinion there is every chance we will see the pound continue its recent trend and claw back some of the ground it has lost since last summer.
As I have already mentioned the U.S. economy has underperformed in recent weeks and the chances of the Federal Reserve raising interest rates in June now seems unlikely.
There had been growing speculation the FED could raise rates in the coming months but with the strong dollar starting to impact economic growth in the US, we might not see a rate hike until the latter part of this year.
This has led investors and market players to look at other alternatives such as the pound and euro, sparking a dollar selloff and reducing the greenbacks value.
So if the U.S economy continues to underperform, the pound continues to be unaffected by the UK election and Greece can come to an agreement with its creditors then I believe there is every chance we will see GBP/USD back towards $1.55 in the not so distant future.
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