The US Dollar slipped against a number of its peers during trading at the start of the week, but has since managed to effect a recovery due to a stabilising security situation.
The Pound has conversely been sent diving, on account of signs that Central and Eastern European nations will not take UK ‘Brexit’ negotiation tactics lying down.
US Dollar Softened by Terror Attacks, Pound Shattered after ‘Brexit’ Hopes Dispelled
US Dollar exchange rate movement was decidedly mixed in the aftermath of the weekend’s bombings in New York and the ‘Buck’ failed to make a real recovery in the wake of such concerning events.
Against the Pound, the US Dollar climbed to 0.77, though mainly due to massive Sterling losses. Fed rate hike chances have remained a pressing concern.
Pound Sterling losses were widespread and significant over September 20th, owing to a major negative reaction among investors to comments made by a Czech official regarding ‘Brexit’.
While Prime Minister Theresa May had previously stated that EU members would be eager to provide the UK with a good deal when leaving, this sentiment was blasted out of the water by Czech remarks that there was ‘zero chance’ of a one-sided UK exit taking place.
In addition to Czech input, Croatia’s Foreign Ministry also had its say, stating;
‘The possibility of ‘cherry-picking’ certain elements, such as access to the single market without participating in all four freedoms, especially the freedom of movement, should be rejected’.
US Dollar Predictions: Presidential Campaign in Focus after NYC Attacks
As the latest in a long string of extraordinary events affecting the US Presidential Election, the recent NYC attacks seem set to galvanise supporters for both sides.
Republican Donald Trump’s bombastic rhetoric has often been criticised as Islamophobic, but if a solid link is made between the arrested suspect and known foreign terror groups then the controversial candidate may receive a surge in support, which would likely further destabilise the US Dollar.
Pound Sterling Forecast: Focus on ‘Brexit’ Talks for Source of Major GBP Movement
Given how dramatically the Pound was sent tumbling by the recent Czech intervention into ‘Brexit ‘ negotiations, this trend seems set to be a continuing, high impact one for the UK currency.
Should UK ‘Brexit’ figures, such as Liam Fox, Boris Johnson and David Davis, continue to support the UK ‘cherry picking’ conditions for its exit from the EU against repeated EU arguments against this outcome, the Pound may deteriorate further in the future.
This would be due to the overwhelming argument of 27 EU states going against one that is attempting to get a good deal by leaving.
Recent USD GBP Exchange Rates
At the time of writing, the US Dollar Pound (USD GBP) exchange rate was trending in the region of 0.7715 and the Pound US Dollar (GBP USD) exchange rate was trending in the region of 1.2967.
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