Dollar Exchange Rate Forecast: GBP/USD To Dip On Syria Conflict

Modified: Friday, 23 August 2013 12:15 BST - Written by John Cameron

STORY LINK Dollar Exchange Rate Forecast: GBP/USD To Dip On Syria Conflict

GBP USD edged higher while GBP AUD & GBP NZD dropped yesterday as appetite for risk re-emerged in the global markets. However, the international community’s divided response to the ongoing Syrian crisis could trigger a renewed downside move for GBP USD.

The Pound Dollar exchange rate is currently trading down by 0.25% at 1.5588 GBP/USD. The Dollar Pound exchange rate is currently trading at 0.6415 USD/GBP.

Global share markets rebounded and risk was back on the agenda of global investors during yesterday’s session in the currency markets. In truth, world equities markets were due a mini-bounce following three consecutive sessions of sustained losses thanks to fears that Fed QE tapering was just around the corner. The usual suspects registered gains as market participants reversed their positions of safety, with the Pound Australian Dollar (GBP/AUD) exchange rate pulling back to as low as 1.7241 during afternoon trading while the Pound New Zealand Dollar exchange rate (GBP/NZD) also edged off its intraday high of 1.9991 when New York opened for business.

The US Dollar gave up a small portion of the gains which it had accrued during the aftermath of Wednesday evening’s Greenback-friendly Federal Reserve minutes, sending the Pound US Dollar exchange rate (GBP/USD) up to the 1.5600s once more. However, the Buck could be in for a sustained bout of renewed safe haven support due to the alarming scenes of earlier in the week in Syria and the diverging reaction to the events from members of the international community.

Russia and China’s lack of willingness to agree to a statement from the UN Security Council condemning the apparent chemical attack on civilians in the troubled Mediterranean state has irked the US and the UK. Meanwhile, yesterday evening’s comments from France’s Foreign Minister Laurent Fabius calling for force to be used against the Syrian regime if evidence emerged that they were behind the attack, has added another dimension to the ongoing conflict. Any suggestion that Western troops might be set to enter Syria in order to restore control would surely send both global equities and the GBP USSD exchange rate lower as the Dollar benefited from strong safe haven support.

International Money Transfer? Ask our resident FX expert a money transfer question or try John's new, free, no-obligation personal service! ,where he helps every step of the way, ensuring you get the best exchange rates on your currency requirements.

TAGS: American Dollar Forecasts Australian Dollar Forecasts Currency Predi Forecasts