Today's Pound to Dollar Exchange Rate Predictions Are Forecasting Gains on Forex Markets

August 27, 2014 - Written by John Cameron

STORY LINK Today's Pound to Dollar Exchange Rate Predictions Are Forecasting Gains on Forex Markets

The mid-week exchange rates trading session brought the publication of further US Dollar (currency:USD)-positive data. However, losses for the Pound to Dollar exchange rate pair were limited. Further downside is predicted for the pair in the near-term forecast

A stellar print from the latest edition of the closely-monitored US Consumer Confidence survey, published yesterday afternoon, suggested that domestic economic participants are super-positive regarding the future prospects for the US economy.

The showing of 92.4 versus an anticipated 89.0 suggested near-euphoric levels of confidence amongst American citizens. The result represented a considerable improvement on July’s reading of 90.3, suggesting that the current message from the Federal Reserve is playing well.

- The US Dollar to Australian Dollar exchange rate is trading down -0.21% at 1.07129 USD/AUD.
- The US Dollar to Canadian Dollar exchange rate is trading down -0.53% at 1.08927 USD/CAD.
- The Dollar to Euro exchange rate is trading down -0.21% at 0.75774 USD/EUR.
- The Dollar to Pound exchange rate is trading down -0.3% at 0.60255 USD/GBP.
- The Dollar to Indian Rupee exchange rate is trading value +0% at 61.20500 USD/INR.
- The Dollar to Rand exchange rate is trading down -0.29% at 10.65150 USD/ZAR.

The Fed Chair Janet Yellen used her setpiece speech at the Jackson Hole economic symposium on Friday to sully the previously clear linkage between US employment market data and the timing of the next interest rate increase in the States. Yellen’s observation that the jobs market in the States continues to show signs of considerable slack, suggested that those waiting for a tightening of policy from the Fed may have to wait until the latter part of 2015.

However, another tier one data set from the US, published earlier yesterday afternoon, added to the generalised impression that the American economic picture is improving to such an extent that the Fed may not be able to resist calls for a rate increase for long. The monthly Durable Goods Orders figure thrashed expectations, showing at a resounding 22.6% versus an expected 8.0%.

In spite of the brace of massively positive data sets, the Buck struggled to break new ground against the Pound Sterling, with the Pound Dollar exchange rate dropping to an intraday low of 1.6546 GBP/USD during the middle part of the session. Greg Anderson of the Bank of Montreal explained yesterday that, ‘we had a big Dollar move last week, so it’d be expected that you’d have a pause. Next week is a lot more important with a lot more first-tier data. I would be long the Dollar.’

Given the weight of Dollar-positive data during the early part of this week, the consensus amongst analysts is that the Buck will perform in a positive fashion during the short to medium term.

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TAGS: American Dollar Forecasts Daily Currency Updates Dollar Po Forecasts