GBP/USD exchange rate back below $1.53

Good afternoon,

Last night's rate announcement from the U.S. Federal Reserve did not spring any major surprises but that didn't stop the dollar gaining against most of the other majors.

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When the news broke that the Fed were not raising interest rates this month you might have thought the market would have remained relatively flat. That was not the case though as the dollar strengthened across the board, pushing GBP/USD down almost a cent to a low of $1.5244.

The announcement left the currency pair at its lowest level since the 13th October and meant the GBP/USD cross had fallen 1.5% in just over week.

So why did the dollar strengthen?

Although the Fed kept rates on hold there was a positive tone to the announcement. In a statement the Federal Open Market Committee (FOMC) said they will continue to watch the global economy and the U.S. labour market for signs of improvement.

The vote showed that only one of the committee members voted in favour of raising the benchmark rate, Jeffery Lacker. While the remaining nine, which included chair women Janet Yellen voted to keep rates on hold.

Despite no action being taken last night the door is still open for the committee to act in six weeks' time when they meet in December. However, time is running out for the central bank to meet expectations of a rate rise this year.

Need to buy or sell dollars?

If you have an upcoming requirement to buy or sell dollars in the coming weeks it is important to know what tools are available to help you make the most from your transfer. Not only can I help you achieve a rate of exchange up to 5% better than those offered by the high-street banks, I can also help you get the timing right on your transfer to maximise your return.

For more information about how I can help or to find out what rate I can offer, 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 exchange rates fall after poor GDP reading

Good afternoon,

The pound lost ground against the dollar during today's session following a weaker than forecast UK Gross Domestic Product (GDP) reading.

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The UK's economy slowed during the third quarter of this year following disappointing results in the manufacturing and construction sectors. Figures released by the Office for National Statistics (ONS) showed growth in the UK had fallen to 0.5%, down from 0.7% in Q2. 

The reading was worse than predicted by analysts who had anticipated the GDP figure coming in at 0.6%. It meant the pound started to lose ground against the U.S. dollar, with the mid-market price settling around $1.53 by the session close.

Could the Federal Reserve take action?

Tomorrow evening the U.S. Federal Reserve will announce their latest interest rate decision. Many within the market had expected the central bank to raise their benchmark rate six weeks ago but following the events in China the Federal Open Market Committee (FOMC) decided against acting in September.

Since then the economic numbers coming out of the U.S. have not been great and it would seem the market has priced in a rate hike coming in December. I think it is unlikely the FOMC will take any action tomorrow as the U.S economy has slowed in recent weeks.

However if the Federal Reserve hint towards a rate rise by the end of the year we can expect some volatility as it is likely we will see the dollar strengthen across the board.

Are you looking to buy or sell dollars?

If you have an upcoming requirement to buy or sell dollars in the coming weeks it is important to know what tools are available to help you make the most from your transfer. Not only can I help you achieve a rate of exchange up to 5% better than those offered by the high-street banks, I can also help you get the timing right on your transfer to maximise your return.

For more information about how I can help or to find out what rate 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.