Pound Sterling to US Dollar (GBP/USD) Exchange Rate – ‘Greenback’ softer in quiet trading

The US Dollar softened in light trading on Monday as US financial institutions were closed for the Martin Luther King Jr national holiday.

Monday proved to be a quiet day overall for the financial markets with only data out of China having significant impact on the market. The US Dollar (USD) initially firmed early in the session after data out of the Asian country showed that the world’s second largest economy saw its growth rate for 2013 come in at a similar figure as that seen in 2012, the lowest level in 14 years. The report created demand for safe havens as concerns were reignited over the outlook for the Chinese economy.

Sterling then pushed higher after a report showed released by Rightmove showed that UK house prices increased yet again this month. The report showed that prices rose at their strongest annual rate since before the credit crunch and that house price rises this month were the highest for any January since records began.

Against the Japanese Yen the ‘Greenback’ declined for a third consecutive day following the publication of the Chinese data. Against the Euro the Dollar slipped away from a two-month high and the Australian Dollar managed to regain some ground.

When the US market reopens on Tuesday investors will be looking ahead to Wednesday’s mortgage and chain store retail sales data. Thursday sees the release of the latest continuing jobless claims data and will see the publication of existing home sales and manufacturing PMI reports. If those reports come in positively then we can expect the US Dollar to revert back to pushing higher.