Hello and good morning,
The pound has risen over half a per cent against the dollar since the London trading session opened, with the GBP/USD cross climbing from $1.2510 to $1.2581, a fresh one week high for the currency pair.
For the best GBP/USD exchange rate click here.
The move this morning adds to the gains we have witnessed over the course of this week, and means the pound has clawed back over 1.7 per cent against the dollar since Tuesday.
If we look at the rise in monetary terms, converting £300,000 into U.S. dollars this morning will now see you receive nearly $6400.00 more compared to the same trade on Tuesday morning.
GBP/USD 48 hour graph
Why has the pound risen?
The pounds value has increased across the board over the past couple of days, and it is mainly down to investor confidence. As I mentioned in my post yesterday morning, investors were quick to jump on the comments made by Kristen Forbes, a Monetary Policy Committee member at the Bank of England.
Forbes stated on Tuesday that the Bank of England might have to reverse Augusts interest rate cut if the UK economy remains solid and inflation continues to pick up.
Her comments have given investor confidence a huge boost and it would seem markets are focusing on the potential rate hike, rather than warnings about the impact Brexit could have on the UK economy.
The pound has continued to rise despite a BoE survey suggesting that employers plan to offer the least generous pay deals for five years and deputy governor Jon Cuncliffe saying that investment in UK businesses is likely to remain very weak in the short term.
GBP/USD forecast
The next few months are likely to bring a huge amount volatility for Sterling crosses especially as we get closer to the government triggering Article 50. I keep reading that as soon as Theresa May invokes Article 50 the pound is going to go into free-fall, however, I actually think we have already seen the pound hit rock bottom.
We have known for months that May plans to trigger Article 50 by the end of March, and we now know she will push ahead with a so called "Hard Brexit" and give up the UK's access to the single market.
I believe both of these scenarios have already been priced into the value of the pound and if the UK economy can stay on its current path then it lays a solid foundation for the pound to rise across the board.
When you take into account the uncertainty across Europe and President Trump trying to devalue the dollar, we could see GBP/USD push back towards the $1.30 mark in the not too distant future.
Do you need to buy or sell dollars?
If you are looking to buy or sell dollars in the weeks and want to make sure are making the most from your transfer, contact me today for a free, no-obligation currency consultation.
As a specialist in currency exchange I have a range of tools at my disposal to help protect you against adverse market movements or target a rate of exchange that might not be currently available.
For more information about how I can help or to find out what rate of exchange I can offer, complete the contact form by click on the link below.
As a specialist in currency exchange I have a range of tools at my disposal to help protect you against adverse market movements or target a rate of exchange that might not be currently available.
For more information about how I can help or to find out what rate of exchange I can offer, complete the contact form by click on the link below.
