Sterling Euro (GBP/EUR) And Sterling US Dollar (GBP/USD) Exchange Rates Drop As UK Parliament Votes Against Syrian Intervention

Modified: Friday, 30 August 2013 17:04 BST - Written by James Fuller

STORY LINK Sterling Euro (GBP/EUR) And Sterling US Dollar (GBP/USD) Exchange Rates Drop As UK Parliament Votes Against Syrian Intervention

The Sterling US Dollar (GBP/USD) and Sterling euro (GBP/EUR) exchange rates have lost ground this morning in spite of positive news from the UK’s housing sector. Meanwhile, the forecast for the Pound is negative due to concerns from investors regarding the UK Parliament’s ‘no’ vote to military intervention in Syria.

The Pound US Dollar exchange rate (GBP/USD) is currently trading down by 0.10% at 1.5481 GBP/USD. The US Dollar Pound exchange rate is currently trading at 0.6460 USD/GBP.

Events during the past 24 hrs have caused the US Dollar to be well-supported, sending the Pound US Dollar (GBP/USD) exchange rate down into the 1.5400s overnight. Last night’s surprise vote against military action against Syria in the UK Parliament has added to the confusion surrounding the incendiary situation in the Middle East.

Last night’s ballot amongst British Parliamentarians was expected to confirm the UK’s support for an American-led attack against Syria’s rogue leadership. The vote against such an action has muddied the waters, causing appetite for risk to leak from the markets, triggering a pronounced bout of safe-haven support for the Greenback. The US tender was already in favour thanks to yesterday’s stronger than anticipated American Q2 GDP data. A trimming of QE from the Federal Reserve in the middle part of next month now looks likelihood, meaning that USD/GBP may register further gains during coming weeks.

Elsewhere, this morning’s stronger than anticipated UK Mortgage Approvals data for July, which showed at 60,600 versus June’s counterpart figure of 58,200, provides further evidence that the UK Coalition Government’s Help For Homes policy, which provides an interest-free top up loan for British homebuyers, is having a positive effect on activity levels in the British housing sector. However, the news has failed to boost Sterling on the day and by the latter part of European equities session, the Pound euro exchange rate (GBP/EUR) was trading back down below the 1.1700 level at 1.1698.

The main risk event of note this afternoon comes in the shape of June’s GDP data in Canada. If, as expected, the figures show a pronounced dip from May’s showing of 2.5%, then expect the Pound to Canadian Dollar exchange rate (GBP/CAD) to break up to a new near-term high.

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