The US Dollar advanced against the weakened Pound on Tuesday after consumer confidence and new home sales data showed that the world’s largest economy is roaring back into life after showing their best performance for six years.
The Conference Board’s index of consumer confidence leapt to 85.2 this month, a sharp rise from the previous month’s figure of 82.2 and beat economist forecasts for a figure of 83.5. The increase was the best figure recorded since January 2008.
Commenting on the report, director of The Conference Board Consumer Research Center Lynn Franco said, “June’s increase was driven primarily by improving current conditions, particularly consumers’ assessment of business conditions.”
Following on from that data was the release of a separate report which showed that new home sales in the US surged to the highest level recorded since 2008.
Purchases of new homes rose by the most in 22 years last month indicating that the USA’s housing market has rebounded strongly from the weakness recorded in the early part of the year.
The US Dollar to Pound exchange rate is trading around 0.5887 – 24/06/14.
According to the Washington based Commerce Department, sales soared by 18.6%, the biggest monthly gain seen since January 1992. The figures smashed all economist forecasts.
Today’s data adds to yesterday’s better than forecast existing home sales and manufacturing activity which came in at its best reading since May 2010.
With data releases coming in strongly we can assume that the US economy is surging back into life and that can only be a good thing for global trade and the world economy in general.
The Pound meanwhile was continuing to be weighed upon by more dovish than expected comments made by Bank of England Governor Mark Carney at today’s Parliamentary Treasury Select Committee. Mr Carney disappointed investors as he toned his rhetoric regarding an early interest rate rise.
As a result the UK currency fell away from key levels against the ‘Greenback’ and Euro.
Updated 09:00 GMT 25 June 2014
US Dollar to Pound (USD/GBP) Exchange Rate Movement Likely Today
As European trading began on Wednesday the US Dollar to Pound exchange rate was trending higher. After slumping against the US Dollar yesterday in response to an unexpected turnaround in the Bank of England’s stance on raising interest rates, the Pound consolidated its declines as investors responded positively to the news that US home sales increased by record amounts while a gauge of consumer confidence for the nation jumped from 82.2 to 85.2 in June.
Movement in the US Dollar to Pound exchange rate could occur as a result of today’s UK Confederation of British Industry reported sales figures and the US final first quarter growth data.
Investors will also be taking an interest in US Durable Goods Orders and Personal Consumption figures.
US Dollar (USD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
US Dollar,
,Pound Sterling,0.5887 ,
US Dollar,,Euro,0.7344 ,
US Dollar,,Canadian Dollar,1.0732 ,
US Dollar,,Australian Dollar,1.0660 ,
Pound Sterling,,US Dollar,1.6984 ,
Euro,,US Dollar,1.3617 ,
[/table]
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