Is Pound Sterling US Dollar Exchange Rate Heading to 1.5000 GBP USD Worst Rate?

August 7, 2015 - Written by John Cameron

STORY LINK Is Pound Sterling US Dollar Exchange Rate Heading to 1.5000 GBP USD Worst Rate?

GBP USD Exchange Rate Heading Lower, US Jobs Data Supports Greenback Trading This Week

The US Dollar (currency : USD) made a roaring comeback against the Pound Sterling (currency : GBP) during this afternoon’s session following the publication of the latest labour market numbers in the States.

Economists had forecast that the headline Non-Farm Payroll data for July would reveal that 225,000 new jobs had been generated in the US economy, so on the face of it the result of 215,000 was a little below par. However, the upward revision to 231,000 to June’s counterpart number provided some grounds for encouragement, but it was the make-up of the jobs created which caused investors to move back into the Greenback.

US Average Earnings Increase, Pound Sterling to US Dollar Conversion Rate Falls on Raised Fed Rate Hike Expectations

The official statistics showed that the ratio of full time jobs in the US had risen to its highest level since the darkest days of the global financial crisis of 7 years ago. The number of full time jobs as a percentage of total employment in the American economy had jumped to 81.7%. For some time, analysts have worried that the apparently strong American jobs numbers were painting an overly-optimistic picture of the state of the US economic position. Looking at the quantitative analysis, the data looked extremely positive, but drilling down into the precise figures, analysts noted that from a qualitative perspective, they lacked a little something, with many Americans working foreshortened hours against their wishes. Today’s numbers appeared to show that this problem is easing and the Pound Sterling US Dollar exchange rate dropped back to as low as 1.5422 GBP USD as a consequence. Analysts now forecast that a trading rate of 1.5000 GBP USD may be attainable in the near-term for the pair.

Newsflash: USD Higher against GBP, EUR, AUD after US NFP Report Today

Tom Porcelli of RBC Capital posited earlier that the, ‘contours of this report are exactly what they’d want to see ahead of liftoff (from the Fed)’. He expanded by stating that, ‘this outcome is totally consistent with the notion that labour slack continues to diminish.’ The outlook for the Pound Sterling US Dollar exchange rate is now negative.

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