The GBP USD exchange rate has remained fairly resilient since Tuesday’s spike thanks to a softer ‘Brexit’ tone from the British Chancellor and a week of largely disappointing US data.
Hammond Remarks Help Prevent Major Drop in GBP USD Exchange Rate
The Pound US Dollar (GBP USD) exchange rate made minimal loses yesterday as UK Chancellor Philip Hammond pushed for a softer approach to ‘Brexit’ negotiations.
In direct opposition with many of his colleagues, Hammond drove for a more relaxed immigration policy. He stated that highly skilled workers should be allowed free access to the UK as voters only wanted restrictions on migrants competing ‘entry level jobs’.
He said;
‘The industry knows that we regard it as extremely important, the industry knows that we understand that it has a particular set of challenges as we go into this period of negotiation with the European Union and that helping to address these challenges and taking account of these challenges will be a very high priority for the government.’
This helped to placate investors who still fear the uncertainty of a ‘hard Brexit’ which has looked increasingly likely in recent weeks following some strong anti-EU rhetoric from certain members of the UK government.
Disappointing UK Retail Sales Cause Slight Dip for Pound (GBP)
The Pound did slide slightly against the US Dollar (GBP USD) following the release of September’s retail sales report however, with data failing to meet expectations.
While sales were able to recover from -0.3% in August, they only rose to 0.0% – falling short of the 0.2% that had been predicted, which sparked fears of a slowdown in the UK economy.
GBP USD Unable to Advance despite Poor US Data
The recent trend of largely negative US Data continued yesterday as September’s US housing starts tumbled to -9.0%, significantly short of the predicted rise to 2.9%.
Despite yet another underwhelming US ecostat, the Pound was still unable to make any further gains against the ‘Greenback’, as the exchange rate held at around 1.22.
GBP USD Exchange Rate Forecast: Currency Pairing Likely to Fluctuate for Remainder of the Week
The GBP USD exchange rate is likely to fluctuate around current levels for the rest of the week, especially if today’s employment data from the US also disappoints.
Looking forward to tomorrow the UK will release its public borrowing report, which is expected to show a slight drop in the deficit, but is unlikely to have any notable effect on the Pound as market sentiment it driven increasingly by political decisions surrounding ‘Brexit’.
Current Interbank Exchange Rates
At the time of writing the GBP USD exchange rate was trending around 1.22 and the USD GBP exchange rate was trending around 0.81.
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