The US Dollar has been tight against the Pound on ‘Brexit Day’, but could rally if Donald Trump’s job-creation promises are ultimately fulfilled.
Trump has recently made headlines by attempting to repeal a piece of so-called ‘job killing’ Obama Administration legislation. The prior policies were designed to protect the environment by limiting US contributions to climate change; this impeded activity in the coal, gas and oil sectors.
Trump’s plan is to bring jobs back to these areas, as part of his broader strategy to ‘make America great again’.
With both New York and California’s Governors declaring Trump’s anti-environment decision as one that was ‘profoundly misguided [that] shockingly ignores basic science’, the question remains of whether this pro-business plan will go ahead.
As well as receiving international criticism from fellow economic superpower China, Trump has also come under fire from environmental groups and has led others to claim it will create jobs for lawyers, not everyday workers.
Among the defiant voices has been Sierra Club Climate Policy Director Liz Perera;
‘We have the economics on our side, we have the market on our side, we have the public on our side, and we have the law on our side – this is endangering public health and welfare. They can’t change any of those things’.
As another major test for the Trump administration, the ability to successfully repeal prior legislation and actually create tangible jobs will be closely judged by traders.
The US Dollar previously plummeted when Trump was defeated on an attempted repeal of Barack Obama’s healthcare plans, so it remains possible that a USD GBP crash is incoming if this latest order fails to gain traction in the House of Representatives.
If it seems as though the UK will not, in the words of Chancellor Philip Hammond, ‘have our cake and eat it’, then the Pound could slide against the US Dollar on renewed fears about the end result of EU negotiations.
Recent Interbank USD GBP Exchange Rates
At the time of writing, the US Dollar to Pound (USD GBP) exchange rate was trading at 0.80 and the Pound to US Dollar (GBP USD) exchange rate was trading at 1.24.