GBP/USD Exchange Rate Flat as UK Politics in Focus
The Pound US Dollar (GBP/USD) exchange rate remains at a standstill this morning as markets await the launch of Labour’s election manifesto.
At the time of writing the GBP/USD exchange rate is trading at around $1.2949, virtually unchanged from the day’s opening rate.
Pound (GBP) to Face Volatility if Labour’s Manifesto Resonates With the Electorate?
The Pound (GBP) is in focus this morning as the race for No10 is set to heat up with the launch of Labour’s election manifesto.
Labour leader Jeremy Corbyn has promised that the manifesto will be his party’s ‘most radical and ambitious plan to transform our country in decades’.
Expect to see Sterling sentiment knocked if markets believe Labour’s policies could hurt businesses.
The real focus however will be on how well Labour’s manifesto goes down with voters, and whether this will help the party catch up to the Conservatives in the polls.
If this is enough to risk the chances of the Tories winning a majority on 12th December then it’s likely we could see GBP exchange rates move lower.
Of course if the manifesto fails to influence the polls then we may see the Pound maintain its bullish trend.
US-China Trade Uncertainty Underpins Bids for the US Dollar (USD)
Meanwhile, the US Dollar (USD) is holding its ground this morning as demand for the safe-haven currency remains robust amidst ongoing US-China trade uncertainty.
Tensions between the two countries have escalated in the past couple of days after the US Senate unanimously voted to approve a bill supporting protestors in Hong Kong.
Responding the passing of the bill Geng Shuang, spokesman at the Chinese foreign ministry, said:
‘We urge the US side to cease this activity, stop before it’s too late and take measures to prevent these measures from becoming law, stop meddling in Hong Kong’s affairs and China’s affairs.
‘If they must insist on going down this wrong path, China will take strong counter measures.’
US President Donald Trump has appeared increasingly pessimistic about the prospect of a deal being signed in the near term, telling reporters in Texas yesterday, ‘I don’t think they’re stepping up to the level that I want’.
This follows a warning by Trump earlier in the week suggesting that the US could impose ‘even higher’ tariffs if negotiations fail.