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Weekly Dollar to Pound Roundup - USD GBP Exchange Rate Analysis

December 7, 2014 - Written by James Fuller

US Dollar to Pound Sterling Exchange Rate Weekly Roundup December 1 - 5



currency forecastsThe US Dollar enjoyed another week of solid gains as confidence continues to increase that the world’s largest economy is continuing to strengthen and is becoming more resilient to external shocks from the weakened Eurozone and a slowing China.

Monday Saw the GBP/USD Exchange Rate Rise



Early on Monday the US Dollar was firmer against its major peers as demand for the safe haven currency was boosted by a further fall in commodity prices and the release of negative data out of China. The major focus for the market will be the latest Markit and ISM Manufacturing PMI data. Economists are forecasting that the data will outdo its global peers.

The US Dollar softened later on Monday following the release of a mixed bag of US factory data that caused some economists to reassess whether the Federal Reserve will raise interest rates next year. As the session progressed however, the currency-regained ground after the ISM Manufacturing PMI came in better than forecast. Market attention will now focus on upcoming US chain store sales and construction spending data.

Wednesday the Pound to Dollar Fell



Midweek, the US Dollar strengthened against the majority of its most traded peers after construction sector spending increased by 1.1% in October from the preceding month. The figure released on Tuesday beat economist forecasts for a rise of 0.6%.

The American Dollar advanced further against most major peers after the Institute of Supply Managements non-manufacturing PMI came in stronger than expected. The index rose to a figure of 59.3 in November, up from the 57.1 figure seen in October. Against the Pound the ‘Greenback’ held onto gains despite UK data showing that the nation’s dominant services sector expanded by a stronger than forecast level in November. The report raised hopes that a forecasted slowdown in the UK economy will not be as severe as previously forecast.

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The Pound Sterling to Dollar Exchange Rate Softened on Thursday



On Thursday, the USD made further gains after the latest US Jobless Claims data showed that fewer American applied for unemployment benefits in the previous week. Against the Euro, the currency softened as European Central Bank President Mario Draghi said that policy makers would not assess the need for introducing a quantitative easing programme until 2015.

As the week ended, the US Dollar strengthened against the Pound and Euro as market attention focuses on upcoming Non-farm payrolls data showed that the labour market in the world’s largest economy continued to strengthen.

The main event for the US currency next week will be Thursday’s retail sales data.
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