The US Dollar has strengthened over 1.30% against the Pound and has jumped upward against the majority of its most traded peers after the Central Banks of the UK and Europe announced that they would be maintaining their interest rate levels.
Until Thursday afternoon, the ‘Greenback’ had been little moved due to today’s public holiday in the US with Americans celebrating their Independence Day. The Dollar found support as a safe haven earlier in the session as worries over a flare up of the Eurozone debt crisis combined with concerns over the overthrow of Egyptian President Mohammed Morsi.
Sterling tumbled sharply against Cable after the Bank of England warned that markets were wrong to assume that it would start raising interest rates soon. The decline came after the Bank held interest rates at 0.5% and maintained its quantitative easing programme unchanged.
“At its meeting today, the Committee noted that the incoming data over the past couple of months had been broadly consistent with the central outlook for output growth and inflation contained in the May Report,” it said, adding that it still expected inflation to rise further in the near term before falling back to the target 2% level.
‘The significant upward movement in market interest rates would, however, weigh on that outlook; in the Committee’s view, the implied rise in the expected future path of Bank Rate was not warranted by the recent developments in the domestic economy” The Bank said in its first ever published statement explaining the broad reasons behind the Bank’s decision.
The next big mover for the Dollar comes on Friday with the release of the latest unemployment data for the world’s largest economy. The overall unemployment rate is expected to fall from 7.6% to 7.5%. If that is the case then the Federal Reserve will be more likely to begin tapering its monetary easing policy sooner rather than later.
US Dollar (USD) Current Exchange Rates
The US Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.6557
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7694
The US Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0972
The US Dollar/Japanese Yen Exchange Rate is currently in the region of: 99.7008
The US Dollar/Canadian Dollar Exchange Rate is currently in the region of: 1.0517
The Pound Sterling/ US Dollar Exchange Rate is currently in the region of: 1.5249
The Euro/US Dollar Exchange Rate is currently in the region of: 1.2996
The Australian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9113
The Canadian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9508
The New Zealand Dollar/US Dollar Exchange Rate is currently in the region of: 0.7790
(Correct as of 15:00 pm GMT)
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