Pound US Dollar Exchange Rate Trades Near 2 Month High after US Claims Surprise Economists

December 1, 2016 - Written by Frank Davies

STORY LINK Pound US Dollar Exchange Rate Trades Near 2 Month High after US Claims Surprise Economists

Pound US Dollar Jumps after ‘Soft Brexit’ Comments

The Pound has been the clear winner in the GBP USD pairing during trading today, having been pushed higher by the latest Brexit talks.

Taking the lead has been Brexit Minister David Davis, who stated that the UK could leave the EU but stay in the single market by paying for access.

Additional support for the US Dollar has come from rising US claims, which have made the Pound the more attractive side of the pairing by far.

Pound Sterling Predictions: Delayed Objection to Single Market Terms may Erode Current GBP Optimism

The end of the week is expected to see the Pound drop off against the US Dollar.

As Sterling has been boosted by a pair of developments today, losses before the weekend on profit-taking are likely. Additionally, if investor attitudes turn against the idea of having to pay the EU after leaving, the Pound can also be expected to tumble.

While the construction PMI for November is expected to rise on Friday morning, this may not be enough to reverse the current levels of negative sentiment racking up against the Pound.

US Dollar Demand Slides after Previous OPEC Oil Price Rush

The US Dollar has been taking a ‘day off’ on Thursday, having risen notably on Wednesday before shedding gains on gross investor profit taking.

The trigger for the USD jump was OPEC finally agreeing to cut oil production, which sent crude costs soaring and demand for the US Dollar through the roof.

In other US news today, the manufacturing PMIs for November have risen above forecasts, but the number of initial jobless claims has also risen by more than expected.

US Dollar Pound Forecast: Payrolls Windfall could Restore USD GBP Lead during Trading Tomorrow

The US Dollar has the potential to rise against the Pound during trading on Friday, given the latest forecasts that have been made for the change in non-farm payrolls figure.

Covering November, a payrolls shift is expected to be upwards from a previous 161k to 180k. If the November unemployment rate drops unexpectedly, this could offer a further advantage to the USD GBP exchange rate.

Outside of these expected announcements, the US Dollar could also appreciate heavily against the Pound on recent oil prices, which have been moving steadily skywards since the OPEC decision.

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