Although yesterday’s US retail sales report boosted the ‘Greenback’ and saw the GBP/USD pairing soften, the Pound has managed to recoup losses and advance modestly on its North American peer in the wake of UK employment figures.
The Pound Sterling to US Dollar Exchange Rate was in the region of 1.5463 as of 11:25 GMT
1 US Dollar is currently worth 0.6468 pence
Sterling strengthened against the majority of its peers after figures compiled by the Office for National Statistics showed that the UK economy added a whopping 69,000 positions in June – far better than the 34,000 gain estimated. Jobless claims also dropped by twice as much as anticipated while average weekly earnings climbed by 2.1 per cent and the unemployment rate held at 7.8 per cent.
According to IGS Global Insight economist Howard Archer: ‘This is a broadly encouraging set of data overall, indicating the labour market is increasingly benefiting from markedly improved economic activity and strengthening business confidence. We now expect unemployment to head gradually lower over the coming months. We anticipate employment in the private sector will gradually pick up, although the increase is likely to be limited by improving productivity as many companies make greater use of the workers they already have.’
The GBP/USD exchange rate hit a high of 1.5504
Sterling continued to trade higher after the minutes from the latest Bank of England policy meeting were published. The minutes showed that Governor Mark Carney didn’t have the full backing of the Monetary Policy Committee when it came to choosing to tie rate increases to unemployment.
The vote came in at 8:1 in favour, with Martin Weale instead pushing for a more hard-line approach to dealing with above-target inflation.
Weale argued that he cast his vote so that he could ‘register his preference for a time horizon for the first inflation knockout that was shorter than proposed. That would make clear that the forward guidance was fully compatible with the committee’s commitment to meeting the 2 per cent inflation target in the medium term.’
Gains against the Euro were limited as the common currency gathered support from the news that the Eurozone finally exited recession in the second quarter of the year.
Additional GBP/USD movement is likely to occur in reaction to today’s US producer price figures. Another positive result could fan speculation regarding the likelihood of the Federal Reserve tapering stimulus and cause the ‘Greenback’ to advance.
Current Pound Sterling (GBP) Exchange Rates:
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The Pound Sterling/US Dollar Exchange Rate is currently in the region of: 1.5463 >
The Pound Sterling/Euro Exchange Rate is currently in the region of: 1.1673 >
The Pound Sterling/Australian Dollar Exchange Rate is currently in the region of: 1.7008 >
The Pound Sterling/New Zealand Dollar Exchange Rate is currently in the region of: 1.9344 <
The US Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6466 <
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8562 <
The Australian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5880 <
The New Zealand Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5174 >
(As of 11:25 GMT)
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