Dollar Exchange Rate: Losses Predicted For GBP USD Rate When debt Deal Is Reached

Modified: Tuesday, 8 October 2013 11:01 BST - Written by John Cameron

STORY LINK Dollar Exchange Rate: Losses Predicted For GBP USD Rate When debt Deal Is Reached

The US Dollar remains under pressure thanks to the ongoing government shutdown in the States. Meanwhile a poor domestic data set has ensured that the Canadian Dollar remains in the doldrums.

The Pound US Dollar exchange rate (GBP/USD) is currently trading up by 0.52% at 1.6091 GBP/USD. The US Dollar Pound exchange rate is currently trading at 0.6215 USD/GBP.

‘Non Farm Friday’ has become an institution in the global currency markets. The first Friday of every calendar month traditionally brings the release of the closely-watched jobs data for the month before from the US economy, the centrepiece of which is invariably the Non Farm Payrolls number. The key publication gives a tell on the net number of jobs created in the combined non-farming sectors of the world’s leading economy and the outcome has wide-ranging effects on almost all of the sixteen most actively traded global currencies.

This month was a little different though; investors had been anticipating the release of September’s US jobs data last Friday but the figures did not come. The ‘no show’ was due to the partial government shutdown which started on Tuesday 1st October following Democrat and Republican lawmakers’ failure to reach a deal on America’s Federal budget. The statisticians who collate the numbers were not at their desks for the latter part of last week, so no figures were forthcoming. If and when the down-tools from over 700,000 government workers ends, look for a strong showing for the NFP figure which follows shortly afterwards to add to the strengthening of the US Dollar. In such an event, a downward shift towards the 1.5000 threshold is likely for the Pound US Dollar exchange rate (GBP/USD).

Elsewhere in North America, a highly disappointing set of Canadian Buildings Permit figures for August heaped pressure on the already down-at-heel Canadian Dollar, sending the Pound Canadian Dollar exchange rate (GBP/CAD) up to as high as 1.6623. Further gains could be in store for the pair if the Republicans refuse to meet their Democrat counterparts at least half way in the US debt row.

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 Canadian Dollar Forecasts Daily Currency U Forecasts