The Pound Sterling to US Dollar (GBP/USD) exchange rate has fared poorly today, with the Pound also falling against many of its other major rivals. The ‘Buck’, by contrast, has made mostly positive movement against its competitors. Today marks a two-working day run of negativity for the Pound, which started after last week’s BoE news wore off.
GBP/USD Exchange Rate News: Implications of ‘Brexit’ Could be Long-Reaching, Say CBI
The Pound’s (GBP) spectacular losses today are mainly a symptom of investor uncertainties, which have stemmed from a prediction made by the Confederation of British Industry (CBI) over the potential outcome of a ‘Brexit’ vote.
According to a report conducted for the CBI by PricewaterhouseCoopers, around £100bn could be lost (a GDP loss of -5%) if the UK pulls away from the EU. The report also stated that almost a million jobs would be put at risk for the same reason. The report predicted that these dire economic conditions would persist up until 2020 and potentially continue long after that as well.
Among the Pound’s losses caused by the news have been -0.5% against the US Dollar (GBP/USD), -0.6% against the Euro (GBP/EUR) and -0.7% against the Danish Krone (GBP/DKK).
US Dollar (USD) Appreciates on Optimistic Fed Statement
The US Dollar (USD) has performed considerably better than the Pound (GBP) today, having made moderate gains against most of its usual peers.
The most notable source of enthusiasm amongst ‘Buck’ investors today has been a speech made by Federal Reserve member Jeffrey Lacker, who has indicated that he is ‘reasonably confident’ that the US economy will meet the 2% inflation rate target in the future.
Even this slightly hawkish statement has been a welcome change from previous dovishness, therefore the appeal of the US Dollar has naturally risen.
Among the recorded gains today have been 0.6% against the Pound Sterling (USD/GBP) and 0.7% against the South African Rand (USD/ZAR).
GBP, USD Exchange Rate Forecast: US Home Sales Data due Today, UK Inflation Out Tomorrow
The next piece of pairing-centric data will come from the US side, with the national existing home sales result for February being announced this afternoon. Present predictions are for a slide from 0.4% to -2.9%.
The next major UK contribution will be the base and Core inflation rate results for February, which are due tomorrow morning. Current expectations are for rises on the month and the year for the base fields but stagnation at 1.2% for the core annual variant.
Current GBP, USD Exchange Rates
The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.4396 and the US Dollar to Pound Sterling (USD/GBP) exchange rate was trending in the region of 0.6948 today.
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