USD GBP Exchange Rate Rises during Ongoing Obamacare Troubles

July 19, 2017 - Written by Toni Johnson

STORY LINK USD GBP Exchange Rate Rises during Ongoing Obamacare Troubles

The latest news in the US has been that Republican efforts to repeal the Affordable Care Act (ACA) have stumbled.

Rising US Homebuilding Triggers USD GBP Advance

Despite the limiting factor of political issues, the US Dollar has made a gain against the Pound today.

This comes after a rise in US building permits and housing construction; the latter has been at the fastest rate in four months.

As well as limiting the effects of a housing shortage, this news has also countered a recent drop in housebuilder confidence.

Elsewhere, the Republican Party has been attempting to repeal and replace the ACA, known as ‘Obamacare’, since the start of Trump’s presidency in January.

Six months later, efforts to have ground to a halt, with even a basic repeal measure failing to gain traction.

Trump has been typically bombastic and polarising in his attitude, declaring that;

‘We're not going to own it. I'm not going to own it. I can tell you the Republicans are not going to own it. We'll let Obamacare fail and then the Democrats are going to come to us. It would be nice to have Democrats support but really they're obstructionists. They have no ideas. They have no thought process. All they want to do is obstruct government and obstruct, period’.

Issuing a strong denouncement of Trump’s attitude has been New Jersey Democratic Senator Cory Booker;

‘The "great deal maker" failed to make a deal. And so now he's just saying “I am going to imperil 30 million Americans”...you will see very devastating things happen. That's just not a cynical way that's violating his promises, that's sinister. It's evil to plot against Americans like that’.

Booker additionally challenged Trump’s assertion that no Democrats had been invited to give their input.

Put in a wider context, this event has been deeply embarrassing for the Trump administration as it represents a failure to pass one of the most widely-promoted reforms.

It remains to be seen whether Obamacare will actually ‘fail’ in the short or long term. Until then, Trump may have to divert his resources and address another key campaign promise, like building the US-Mexico border wall for example.

Pound Trades Tightly as UK Business Confidence Drops

The latest GBP USD slip has come after reports of sliding national business confidence. In the wake of the general election, companies have lowered their economic outlooks for 2017 and beyond.

Described as the ‘most challenging economic situation the UK has seen in several years’ by some economists, the inter-Brexit conditions have taken a serious toll on UK optimism.

Adding to the worrying stats was the news that a number of businesses are only in the early stages of planning for the post-Brexit period.

USD GBP Forecast: UK Sales Stats could Trigger Pound Upsurge

Asides from any surprise Trump announcements, the US Dollar is next expected to be moved by Thursday’s initial and continuing jobless claims stats.

In July, continuing claims are forecast to rise, compared to a slight initial dip. While considered medium-impact, this result could still raise the US Dollar’s value.

The UK’s ecostats on Thursday could create a greater stir, as they will cover retail sales recorded in June. Forecasts have been positive, for growing sales across the board with and without fuel included.

Such a result could boost the Pound, for a reason tied in with the UK’s economic situation. With inflation rising above the rate of wage growth, UK ‘real incomes’ have been squeezed.

This means that due to tighter household budgets, UK consumers may be reconsidering making inessential purchases, which would negatively impact recorded sales.

If June’s sales figures do rise, then trader concerns about persistently slowing retail activity may be temporarily reduced.

According to British Retail Consortium Chief Executive Helen Dickson, the Islamic holiday of Eid al-Fitr may have contributed to rising sales;

‘Leisure pursuits and activities spurred consumer spending on summer clothing, beauty products and outdoor toys, which were also boosted by gift purchases over Eid’.

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