The Pound US Dollar (GBP/USD) exchange rate has been trading in a mixed range for much of the day as the ISM non-manufacturing PMI came in just below forecasts.
At the time of writing the GBP/USD exchange rate is trending at around $1.3912 as the Pound continues to be supported by economic optimism surrounding the UK’s recovery from coronavirus.
Pound (GBP) Supported by UK Economic Optimism
The Pound has been supported against many of its major rivals throughout the day as the currency continues to be supported by economic optimism as the UK recovers from the coronavirus pandemic.
The next stage of lockdown easing in England is fast approaching and is to be implemented on the 17th May.
The next stage of easing will see indoor hospitality including bars and restaurants reopen and up to 30 people allowed to meet outdoors.
Vaccines minister Nadhim Zahawi has been optimistic surrounding the next stage of England’s roadmap, speaking to British television this morning he said:
‘I’m not seeing any evidence that would lead me to believe that we are not going to meet the 17th of May and – with the caveat that we continue to analyse the data – the 21st of June as well, and we get ourselves away from this pandemic and into a world where we deal with it the way we deal with the flu virus.’
Pound investors will await the latest interest rate decision from the Bank of England (BoE) tomorrow with a hawkish tone from the bank expected.
US Dollar (USD) Limited by Non-Manufacturing PMI
The US Dollar has been trading in a mixed range for much of the day after the latest ISM non-manufacturing PMI fell to 62.7 in April from an all-time high of 63.7 in the month previous and below market forecasts.
A quote from the ISM regarding the fall revealed that finding workers was still an issue in the US:
‘Consistent with the past year, labor continues to be the biggest issue we are facing. Finding and retaining labor — skilled and unskilled — is highly challenging and frustrating. As the challenges continue, we are not accepting all the work that we could if we had the labor.’
The US Dollar has continued to find support in the swift recovery of the US’s economic recovery from the coronavirus pandemic today.
Pound US Dollar Exchange Rate Outlook: BoE Interest Rate Decision in Focus
For Pound investors, tomorrow will see the BoE’s latest interest rate decision. Although no policy changes are expected from the bank, a positive outlook from the bank surrounding the UK’s rapid recovery from coronavirus could see the Pound head higher.
US Dollar traders will be looking towards the latest jobless claims from the US which are forecast to have fallen to 545k, below pre-pandemic levels.
The sustained fall could see the US Dollar head higher as the US economy recovers from the effects of the coronavirus pandemic.
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