GBP/USD falls to its lowest level since April

Good afternoon,

The pound continued to lose ground against the dollar today with currency pair falling to its lowest level since 23rd April. GBP/USD slipped to a low of $1.5110 this afternoon meaning the cross has dropped by around 3.3% in the last two weeks.

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Job numbers help boost the dollar.

One of the main factors behind the dollar's rise today was the release of the latest private-sector jobs data. The data release showed that private employers in the U.S added 200,000 jobs in September, beating the forecast of 192,000.

The dollar immediately strengthened on the back of the news as investors increased their bets on the U.S. Federal Reserve increasing interest rates before the turn of the year.

All eyes will now turn to Janet Yellen when she speaks this evening at the Federal Reserve's annual community banking conference and the U.S. Non-farm payroll numbers on Friday afternoon.

If Chair Janet Yellen is hawkish in her speech this evening and we see a positive jobs reading on Friday it is highly likely we will see the dollar continue to gain momentum. With GBP/USD declining so much over the past couple of weeks it is possible we could see the currency pair drop below $1.50 before the weeks is out.

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Will they or won't they? cruch time for the Federal Reserve.

Good afternoon,

It has been a relatively quiet day for the GBP/USD cross with the currency pair finishing the day around half a cent off its opening price. With little to write home about in regards to eco-stats, all eyes are firmly fixed on the U.S Federal Reserve and their two day meeting which starts on Wednesday.

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Come Thursday evening we will finally know if the FOMC plan to raise interest rates for the first time since 2006. However, with more disappointing coming from China this morning the chances of the Federal Reserve taking any action now seem slim.

Concerns over an economic slowdown in China have seen bets trimmed on the Federal Reserve hiking rates this month. In fact U.S. interest rates futures are now suggesting traders see around a 1 in 4 chance the Fed will raise interest rates on Thursday evening.

So if the Fed keep rates on hold will GBP/USD go up?

Not necessarily, even if the Fed choose not to act this month they could still drop so clues as to when the rate rise might occur. All the talk has been that if it doesn't happen this month then it could happen in December.

If that is case and the FOMC confirms a rate hike is likely to happen towards the end of the year we could still see the dollar strengthen.

With all the volatility we have seen over the past few weeks I think the markets are looking for a little bit of reassurance. If the Fed's comments mirror those of the Bank of England last week, we could easily see investor flows into the dollar increase which in turn could push GBP/USD back towards the $1.52 mark we witnessed a few weeks ago.

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GBP/USD climbs to two week high.

Good afternoon,

The pound rose by 0.85% against the dollar during today's session as comments following the Bank of England interest rate decision kept investors on their toes.

Most investors had been expecting a dovish tone to the Bank of England minutes following the current global uncertainty, which has stemmed from China's economic slowdown.

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However, the minutes showed that recent developments around the globe did not yet appear sufficient to alter the central banks outlook on monetary policy, and meant the Monetary Policy Committee rate vote remained at 8-1 for the second consecutive month.

The news pushed the GBP/USD cross from $1.5340 to a high of $1.5473, the highest we have seen the currency pair since the 27th August.

All eyes on the Federal Reserve.

Now that we have heard from the Bank of England all eyes will now shift to the U.S. Federal Reserve meeting next week. The FED's policymakers are due to meet on the 16th and 17th with the prime focus on interest rates.

For months September had been the date in everyone's diary the FED would finally increase its benchmark rate. However with events in China dominating the headlines it looked as though any decision would be pushed back until at least December.

There is still an outside chance the FED could take action next week, especially if they are thinking along the same lines as the Bank of England.

A rate hike next week will see investors flock to the U.S and the flows into the country will certainly mean the dollar strengthens. How much is anyone's guess but as I have said before I wouldn't be surprised if GBP/USD ended up back towards $1.50.

If you have a requirement to buy or sell dollars in the coming weeks and want to make sure 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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GBP/USD rate remains flat ahead of BoE decision

Good afternoon,

After all the recent turmoil which has surrounded the currency markets over the past month, today has been relatively low key with the GBP/USD cross trading in a half cent range.

The currency pair spent the day sitting between $1.5350 and $1.54 as you can see from the graph below, however that could all change tomorrow as the markets turn their attention to the Bank of England monetary meeting.

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Only weeks ago Bank of England Governor Mark Carney hinted that a rate rise in the UK was on the horizon, which was then backed up in Augusts MPC meeting when one member voted in favour of an immediate rate hike.

I don't think anyone is expecting the Bank of England to raise their benchmark anytime soon, concerns over global growth and an economic slowdown in China have put pay to that. The pound could come under pressure if the MPC rate vote reverts back to 9-0 after only one month.

If that were to happen we could easily see the pound lose some of the ground it has made against the dollar in the last few days and I wanted be surprised if we see GBP/USD drop back towards $1.52 mark.

I will keep you posted of the developments tomorrow but in the meantime if you have a requirement to buy or sell dollars in the coming weeks and want to make sure you are making the most from your transfer, use the link below to complete the contact form all call me directly on 0044 (0) 1442 892 065.

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Could GBP/USD fall back below $1.50?

Good afternoon,

Since the stock market crash two weeks ago the GBP/USD cross has come under an increased amount of pressure with the currency pair falling almost 4%.

Since the 25th August GBP/USD has slipped from $1.58 to a $1.5169 this morning, before gaining over a cent throughout today's session as you can see from the graph below.

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Not even Friday's weaker than forecast U.S. jobs reading could help the pound claw back some of the ground it has lost in the past two weeks. The number of jobs created last month came in at 173K compared to the predicted level of 215K but did little to dampen the dollar's gains.

It was a report the U.S. Federal Reserve members would have been watching closely as they are due to meet on 16th to discuss the countries future monetary policy. Recent events around the globe have led to speculation the Fed would push back their interest rate decision into early 2016, however, a speech from Richmond Fed President Jeffrey Lacker on Friday has left the door open for the U.S. central bank to take action in nine day's time.

His speech titled, 'The case against further delay' outlined his views as to why the Fed should take action sooner rather than later and stated "it was time to align our monetary policy with the significant progress we have made."

Mr Lacker's comments went some way to shake off the disappointment of the jobs reading and has left investors and markets players eagerly waiting for the Federal Reserve's interest rate decision.

If the Fed do decide that now is the time to hike their benchmark rate we face the possibility of GBP/USD dropping back below $1.50 for the first time since April, great news for those of you looking to sell dollars.

If you have a requirement to buy or sell dollars in the coming months 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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