Pound to Dollar Exchange Rate Today - GBP USD Heads Higher, GBP EUR Static As IMF Issues Warning

January 25, 2012 - Written by Frank Davies

STORY LINK Pound to Dollar Exchange Rate Today - GBP USD Heads Higher, GBP EUR Static As IMF Issues Warning

The Pound Euro exchange rate (GBP EUR) is 1.1970. The Pound Dollar exchange rate (GBP USD) is 1.5606. The Pound Australian Dollar exchange rate (GBP AUD) is 1.4814.

Yesterday’s session was marked by a doom-laden statement from the IMF regarding the future prospects of the world’s economy. It wasn’t the first time in recent months that the organisation had issued a bleak assessment of the road ahead. The IMF warned that eurozone policy-makers’ continuing failure to resolve the region’s debt crisis have lead the global economy ‘deeply into the danger zone’.

The IMF went on to state that it was slashing its growth predictions for worldwide economic activity for 2012 to 3.25% from its previous estimate of 4.00%. GDP growth projections for the UK economy were also cut from an earlier 1.6% to 0.6% for this year, while activity in the eurozone is set to contract by 0.6% this year, signalling a ‘double dip’ recession in the region.

The mood of gloom in the markets was added to with the overnight release of Japanese trade figures, which saw the second largest economy in Asia post its first annualised trade deficit for over 30 years. Analysts attributed the figure to the delayed effect that last year’s earthquake and tsunami had on the Japanese economy’s capacity; it’s likely that decreased demand from ailing export markets and the historically strong Yen were additional contributory factors.

Asian stock indices bucked the trend set by their European counterparts and held up well last night in spite of the poor news emanating from Japan and lower than anticipated Australian inflation numbers. This saw Tokyo’s benchmark Nikkei 225 index climb by over 1% on the session, leading to continued US Dollar weakness, which has taken the GBP USD exchange rate back above the 1.5600 level overnight. However, the uptrend for GBP USD could be rapidly reversed if there is bad news from the continuing debt discussions between Greece’s creditors and the eurogroup.


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