Currency News

Daily Exchange Rate Forecasts & Currency News

GBP USD Exchange Rate Holds Steady ahead of EU Summit Vote

December 15, 2017 - Written by John Cameron

The Pound US Dollar (GBP USD) exchange rate is holding steady this morning as investors await a vote from EU leaders later today on whether to move to the second stage of Brexit talks.

Sterling Steady ahead of Key EU Vote on Brexit



The Pound is holding its ground this morning as investors await the EU vote on Brexit later today.

EU leaders are expected to vote in favour of allowing Brexit talks to move on to the second stage today after a deal was struck late last week on the terms of the UK’s exit agreement.

However despite investors likely to be relieved by the vote as it allows the second phase of talks to finally get under way some analysts suggest that Sterling sentiment could still tumble in the wake of the vote.

Connor Campbell, financial analyst at Spreadex, said;

‘Dependent on whether its announced in time, it’ll be interesting to see how much the pound moves on the expected formal confirmation from EU leaders that they’re ready to move on to the next stage of negotiations with the UK. And while the fact that it is almost a given at this point might dampen the sterling’s enthusiasm, considering it’s rocky December form the currency shouldn’t turn its nose up at any good news, however predictable.’

‘Regardless it does seem like the pound is waiting for something. Against the dollar it has trickled into the red, but is still holding around $1.343.’

Advertisement
A possible reason for this dip is the realisation that the second stage of talks are likely to fraught with even more difficulty that the first stage as the two side attempt to forge the terms of a future relationship.

US Dollar Weakened by Tax Doubts



Meanwhile the US Dollar is under pressure this morning as investors express doubts over the possibility of Trump’s long awaited tax reform being passed next week.

The latest doubts comes Florida Senator Marco Rubio said he would abstain from the vote unless changes were made to expand the credit package to help working families.

This comes hot on the heels on the loss of the Republican seat in Alabama to the Democrats earlier this week’ reducing the Republican majority to a single seat in the Senate.

Compound this problem is that a number of Republican senators may miss the vote due to health related reasons, with both John McCain, the Arizona senator, and Thad Cochran of Mississippi absent in recent days.

Jasper Lawler, head of research at London Capital Group, said;

‘Republicans can’t afford to lose more than two votes, or the bill won’t get the necessary approval. Adding to tension, several Republican Senators are experiencing health problems, which could also prevent them voting. Following Rubio’s comment US indices took a turn for the worse. Investors have been watching the twists and turns of this bill with great focus, because of its expected impact on big firms.’

Republicans are expected to try and hash out come kind of compromise plan later today, but investors remain doubtful on whether this will be successful.

GBP USD Forecast: US Industrial Production to Slip?



Looking ahead the GBP USD exchange rate may rally later today at the US publishes its latest industrial production figures as economists forecast that output growth will slow from 0.9% to 0.3% in November as production normalises after surging as factories reopened following the disruptions caused by two hurricanes earlier this year.

Meanwhile outside of the EU summit vote on Brexit talks with little left to impact the Pound this week, will investors likely to look towards the CBI industrial order index next week, with an expected fall from 17 to 3 likely to weaken Sterling.

Current Interbank Exchange Rates



At the time of writing the GBP USD exchange rate was trending around 1.3415 and the USD GBP exchange rate was trending around 0.7454.

Like this piece? Please share with your friends and colleagues:

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: Pound Dollar Forecasts

Comments are currrently disabled