Pound to US Dollar Exchange Rate mixed following Michigan Consumer Sentiment report

The GBP to USD exchange rate was mixed on Thursday and edged further away from Tuesday’s four-year high following the release of better-than-expected durable goods orders data.

Earlier in the session Sterling found support from a report released by the Confederation of British Industry which showed that retail sales and confidence increased in April.

“The fifth consecutive monthly increase in year on year sales growth is welcome news, particularly as the time period is being compared to 2013’s earlier Easter weekend. Economic indicators remain positive, including recent reports that wage growth is overtaking inflation,” said Richard Lowe, head of retail and wholesale at Barclays.

As the session progressed the Pound softened before holding settling into the 1.67 region after the US Dollar received support from better-than-forecast durable goods data.

According to the US Commerce Department, orders for long lasting manufactured products increased by 2.6% in March beating expectations for a gain of 2%. Core durable goods orders smashed economist forecasts by increasing by 2% instead of the expected rise of 0.6%.

The ‘Greenback’ could have strengthened but a separate report showed that the number of US citizens claiming jobless benefits increased more than expected last week. Jobless claims increased by 24,000 to 329,000 according to the Washington based Labour Department.

Despite the rise in the number of claimants, economists remain fairly optimistic that the labour market is strengthening. The four-week average of claims, a less-volatile measure than the weekly figure, climbed to 316,750 from 312,000 the week before, the lowest since 2007.

US Dollar Update – 15.00 – 25/04/14

The US Dollar briefly softened against the Pound and Euro after Markit’s flash Service PMI for April came in below economist forecasts. Economists had been expecting the PMI to show a reading of 55.5. Instead the report came in at 54.2.

The ‘Greenback’ then reversed its losses after the Michigan Consumer Sentiment report beat expectations. Economists had been calling for a figure of 82.6; instead it came in at 84.1 suggesting that US consumers which contribute most to the nation’s GDP are feeling increasingly optimistic.