The Pound Sterling to US Dollar (GBP/USD) exchange rate weakened further as economic data out of the USA beat economist forecasts.
The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending December 6 decreased by 3,000 to 294,000 from the previous week’s total of 297,000
US retail sales increased by 0.7% last month, beating expectations for a gain of 0.4%. Retail sales growth for October was revised up to a 0.5% increase from a previously reported gain of 0.3%.
Earlier in the session the Pound Sterling to US Dollar (GBP/USD) exchange rate weakened on Thursday as the sharp selloff of the US currency ended and as UK house price data added to concerns over a slowdown in the nation’s economy.
The US Dollar firmed against most of its major peers due to the ending of a steep selloff sparked by concerns over political instability in Greece and a weakening Chinese economy caused investors to embark on a heavy bout of profit taking.
Today demand for the US Dollar was revived as the currency received support from the diverging monetary policy stance of the Federal Reserve and other central banks such as the Japanese central bank and European central bank.
More Gains Forecast for US Dollar Exchange Rate
The US Dollar is likely to make further gains against the Pound and other major peers as market attention turns to upcoming continuing jobless claims and retail sales data.
Some economists are expecting the number of Americans continuing to receive unemployment benefits to have fallen in the week ending on November 29.
Retail sales meanwhile are forecast to have improved despite a relatively disappointing Black Friday sale.
Also supporting the US Dollar is increased market fears over the strength of the global economy. Tumbling oil prices caused Norway’s central bank to warn that the economy is weakening. The Scandinavian is just the latest nation to warn of a slowdown in its economy. Demand for the safer haven ‘Greenback’ increased as a result.
Pound Sterling to US Dollar (GBP/USD) Exchange Rate Falls
The Pound Sterling weakened against the US Dollar after a report published by the Royal Institution of Chartered Surveyors (RICS) showed that house price growth slowed for a sixth consecutive month in November.
RICS said its house-price gauge fell to 13, the lowest since May 2013, from 20 in October. An index for London dropped to minus 40, the least since 2010, from minus 33.
The Pound softened despite Bank of England policy maker Ian McCafferty saying that a run of weak wage growth in the UK might be close to a turning point and that the case for an interest rate hike is strengthening. He did however warn that the nation’s low productivity may take some time to improve.
US Dollar (USD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
US Dollar,
,Pound Sterling,0.6372 ,
US Dollar,,Euro,0.8075 ,
US Dollar,,Canadian Dollar,1.1529 ,
US Dollar,,Australian Dollar,1.2118 ,
Pound Sterling,,US Dollar,1.5697 ,
Euro,,US Dollar,1.2382 ,
[/table]
