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Pound US Dollar Exchange Rate Gaining Ground amidst Improving Market Sentiment

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Pound US Dollar Exchange Rate Climbs as Market Mood Recovers

The Pound US Dollar (GBP/USD) exchange rate is trending higher today as market sentiment rallies amid renewed optimism surrounding the Russia-Ukraine war.

At the time of writing, the GBP/USD exchange rate is trading at approximately $1.3162, roughly up by 0.5% from today’s opening levels.

Pound (GBP) Trades Higher as Market Sentiment Rebounds

The Pound (GBP) is rising against the US Dollar (USD) today as an improving market mood offers Sterling some support.

News of a ceasefire at various Ukrainian cities, allowing civilians to flee the warzone through ‘humanitarian corridors’, has improved market sentiment today.

During this time, Russia has vowed a ‘regime of silence’ to allow civilians to find safety. Moscow has also stated that ‘some progress has been made’ following three rounds of discussion between Russian-Ukrainian officials.

Renewed hope of a diplomatic solution being found is contributing to the improved sentiment.

Russian and Ukrainian Foreign Ministers, Sergey Lavrov and Dmytro Kuleba, have agreed to meet in Turkey on Thursday which Kuleba hopes will ‘lead to peace and stability.’

Turkey has agreed to mediate the discussions due to its good relations with both Moscow and Kyiv, in an effort to bring the war to a swift close, having previously called Putin’s actions ‘unacceptable.’

However Kuleba has stated that he has low expectations of these talks which are capping the Pound’s upside.

Kuleba said:

‘I will say frankly that my expectations of the talks are low. We are interested in a ceasefire, liberating our territories and the third point is to resolve all humanitarian issues.’

US Dollar (USD) Struggles Following Biden’s Ban on Russian Energy

The US Dollar (USD) is falling against the Pound (GBP) today in response to the improved sentiment which is driving investors away from safe haven currencies.

Moreover, Joe Biden’s announcement of an immediate ban on Russian oil and gas yesterday is further undermining the ‘Greenback’.

This ban aims to ‘inflict further pain on Putin.’

Biden continued:

‘Today I am announcing the United States is targeting the main artery of Russia’s economy. We’re banning all imports of Russian oil and gas and energy. That means Russian oil will no longer be acceptable at U.S. ports and the American people will deal another powerful blow to Putin’s war machine.

‘With this action, [oil prices are] going to go up further. Russia’s aggression has cost us all, and it’s no time for profiteering or price gouging.’

On Tuesday, following Biden’s announcement, US gas prices soared to a 14-year high before edging down again.

Capping USD’s downside is the increase in US job openings, with 11.236 million jobs available in January up from the previous print and market forecast of 10.925 million.