Some weaker than forecast U.S Industrial Production numbers helped push GBP/USD rates up today with the currency pair climbing from $1.5488 to 1.5569. The move leaves the cross at its highest level since the 22nd May and means the pound has clawed back almost four cents since the start of the month.
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With talks between Greece and its creditors breaking down after only 45 minutes on Sunday the pound initially dropped against the dollar during the early part of today's session. As we have seen on a number of occasions over the last few months negative news from the troubled Greeks often causes investors to seek the safety of the greenback and this morning was no different.
As markets reacted to the news GBP/USD fell nearly half a cent but with the U.S industrial figures coming in at -0.2% against a predicted level of 0.2% the dollar weakened over the course of the afternoon.
Despite the very brief spike over $1.58 back in May GBP/USD rates are very close to the best we have seen all year. The move we have seen in the last two weeks makes a huge difference to those of you looking to purchase dollars, $200,000 will now cost £3100 less than at the start of the month.
Will GBP/USD continue to rise?
As we have seen in the past month or so things can change very quickly when it comes to the currency markets. This week could see further volatility for the GBP/USD cross as we await the result of the latest Federal Reserve meeting.
Speculation is mounting that Fed Chair Janet Yellen could give a definitive time frame on when the central bank will look to raise interest rates.
Any positive comments from the Fed on Wednesday could see the dollar gain momentum and the gains made by the pound will be quickly wiped away. Some forecasts are suggesting that GBP/USD will be back in the 1.40's during Q3 and this will be based on the Fed starting to raise their benchmark rate in September.
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