Pound Dollar Exchange Rate Outlook: GBP/USD Forecast To Climb In Spite Of Plosser Comments

Modified: Tuesday, 19 November 2013 10:07 BST - Written by David Woodsmith

STORY LINK Pound Dollar Exchange Rate Outlook: GBP/USD Forecast To Climb In Spite Of Plosser Comments

The Pound to US Dollar exchange rate (GBP/USD) has come a long way in a relatively short space of time. As recently as the early part of Summer, the pair was changing hands in the higher end of the 1.4000s but the intervening period has seen the Pound motor northwards against a lacklustre Greenback.

The move higher for GBP USD has partly been attributable to a strengthening in Sterling as economic conditions in the British economy ameliorated, but most of the increase has been down to selling pressure on the Buck. The shift out of Dollar-denominated assets was accentuated during the latter part of last week when Fed Chairperson elect Janet Yellen addressed the US Senate, informing the assembled lawmakers that QE had had an exclusively positive effect on the American economy and that it should continue until the US employment sector was well and truly out of the woods.

Comments See Pound Dollar Exchange Rate Trade as High as 1.6148 GBP/USD

The market’s continued response to Yellen’s comments saw the GBP USD exchange rate trade up to as high as 1.6148 during yesterday’s session. Given the fact that global stocks continue to register strong gains, as evidenced by yesterday’s move up through the 16,000 barrier for the first time by the Dow Jones in New York, it appears that there could be further upside to come for GBP USD.

However, there was a notable dissenter amongst the Fed’s ranks yesterday with Charles Plosser publicly stating that the US central bank should be focussing on price stability as opposed to continued monetary easing. At the moment, Plosser is out on a limb at the Fed, but if his ideas gain a foothold, then look for GBP USD to re-establish itself in the 1.5000s once more. More talk of the need to suppress US inflation would also be likely to send the GBP AUD, GBP NZD and GBP ZAD exchange rates higher as investors moved out of risk.

Key Dollar Exchange Rates(19/11/2103 10:00 GMT

The Dollar Pound exchange rate is trading up 0.12% at 0.6212 USD/GBP.
The Dollar Australian Dollar exchange rate is trading down 0.54% at 1.06174 USD/AUD.
The Dollar Canadian Dollar exchange rate is trading up 0.09% at 1.0442 USD/CAD.
The Dollar Euro exchange rate is trading down 0.06% at 0.7402 USD/EUR.

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 Canadian Dolla Forecasts