The Pound Sterling to US Dollar (GBP/USD) exchange rate strengthened by around 0.68% on Friday morning.
After British economic data produced mostly positive results, the Pound strengthened versus the majority of its most traded currency rivals. The appreciation is likely to be somewhat sluggish, however, with the forthcoming general election weighing on investor confidence amid political uncertainty.
The US Dollar, meanwhile, softened versus most of its major peers on Friday. This is as a result of continued bearishness after a string of disappointing domestic data results. US inflation data, due for publication later on Friday, has the potential to provoke changes for the ‘Buck’ (USD).
The Pound Sterling to US Dollar (GBP/USD) exchange rate is currently trending in the region of 1.5027.
Pound Sterling (GBP) Exchange Rate Advances on Labour Market Data
Given that Bank of England (BoE) policymakers stated that improved labour market data would be vital before a benchmark rate increase, Friday’s positive jobs data results has caused the Pound to strengthen versus many of its most traded currency competitors. The appreciation is likely to be slowed, however, with the forthcoming general election causing traders to fear a dramatic policy overhaul.
Whilst Average Weekly Earnings including bonus (3M/YoY) failed to meet with the median market forecast of 1.8% in February, with the actual result at 1.7%, earnings excluding bonus bettered estimates. February’s Employment Change bettered the market consensus of 170,000 newly employed, with the actual results showing 248,000. Unemployment Rate met with predictions of a drop from 5.7% to 5.6% in February. March’s Jobless Claims Change rose from -29,100 to -20,700 despite expectations it would hold in line with the previous figure.
The Press Association (PA) stated; ‘Data from the Office for National Statistics (ONS) showed that more than 31 million people were in work after an increase of more than half a million in the past year, the biggest total since records began in 1971.’
The Pound Sterling to US Dollar (GBP/USD) exchange rate dropped to a low of 1.4913 today.
US Dollar (USD) Exchange Rate Softens as Economists Pare Fed Bets
After a succession of disappointing domestic data results, the US Dollar softened versus most of its major rivals. The poor data has led economists to pare bets as to the timing of a Federal Reserve rate hike, with very few still holding on to the possibility of a June increase.
Sarah House, an economist in Charlotte, North Carolina said that the combination of weak data and the Fed’s analysis of those figures at their last meeting provoked a move by Wells Fargo Securities to alter their rate-hike projection to September from June. ‘What we got from that meeting confirmed a lot of people’s leanings,’ said House. ‘The fundamentals are still good, but we just don’t think you’re going to be able to get confirmation on that in time for the June meeting,’ she added.
Pound Sterling to US Dollar (GBP/USD) Exchange Rate Forecast to Fluctuate
Although the British asset is likely to hold gains over its North American counterpart; US data could provoke changes. Therefore, there is a high likelihood that the Pound Sterling to US Dollar (GBP/USD) exchange rate will fluctuate over the course of Friday’s European session. Should the US inflation data print positively there is a chance that the US Dollar will gradually strengthen over the coming weekend.
The Pound Sterling to US Dollar (GBP/USD) exchange rate climbed to a high of 1.5036 today.
