Currency News

Daily Exchange Rate Forecasts & Currency News

Pound to Dollar Exchange Rate: May?s Brexit Draft Discussions Steady Sterling

November 19, 2018 - Written by David Woodsmith

GBP/USD Exchange Rate Finds Footing during Lull in Brexit News

The Pound US Dollar (GPB/USD) exchange rate saw something of a recovery today, with Sterling up 0.3% against the ‘Greenback’, and currently trading at $1.28.

As Prime Minister Theresa May presses on with her Brexit deal, demonstrating resilience despite the threat of a no-confidence vote, Sterling is in a holding pattern awaiting further developments.

GBP/USD was further bolstered by some recent comments made by the EU’s Brexit negotiator, Michel Barnier, who announced a possible extension of the UK’s Brexit transition period until 2022.

Pound Sterling US Dollar (GBP/USD) Exchange Rate Gains Ground Despite Falling House Prices

Sterling (GBP) gained ground on the US Dollar (USD) today despite some disappointing house prices from RightMove, which revealed the largest loss since 2012.

Falling on average by 0.2% from last year, London properties slid by 1.7% in November, while prices in the South East slid by 2.1%

Nevertheless, with Brexit still dominating the pairing’s exchange rate further gains have been capped by Theresa May’s potential vote of no-confidence.

Sterling’s Temporary Gains against the US Dollar (USD) Likely to be Short-Lived

The Pound Sterling to US Dollar (GBP/USD) exchange rate has managed to eke out some modest gains since Friday, with Environment Secretary Michael Gove’s decision to remain in cabinet lending support to Sterling.

The Pound has also benefited from the news that Brexiteers still lack the 48 letters needed to trigger a vote of no confidence.

US Dollar (USD) to Pound Sterling (GBP) Exchange Rate Effected by ‘Neutral’ Interest Rates Comments from Fed Clarida

While the Pound is still struggling, the US Dollar (USD) has come under pressure of its own thanks to recent comments from the Federal Reserve’s Vice-Chair.

Fed official Richard Clarida said on Friday that he sees interest rates getting closer to a ‘neutral’ level, possibly presaging a slowing pace of monetary tightening for 2019 and dampening investor sentiment in the ‘Greenback’.

Mr. Clarida said to CNBC:

‘As you move in the range of policy that by some estimates is close to neutral, then with the economy doing well it's appropriate to sort of shift the emphasis toward being more data dependent.’

The US Dollar (USD) also took a hit from the recent lack of consensus between US and China at the Asia-Pacific Economic Cooperation (APEC) meeting. However Paul Gruenwald, chief economist at S&P Global Ratings, said: ‘I really think the big action’s going to be in Argentina in a couple of weeks, so let’s see what happens.’

GBP/USD: Outlook Remains Focused on Brexit and Fears of No-Confidence Vote

Bank of England Governor Mark Carney and three other officials will be offering their thoughts to the Treasury Select Committee on Tuesday.

With Brexit so firmly in the spotlight, the speeches could focus on whether the central bank is prepared for the prospect of a no deal outcome.

But as long as the UK political scene remains calmer, the GBP/USD exchange rate could gain this week as Thanksgiving and Black Friday result in a slow news week in the US.

The only US data of note this week is the nation’s durable goods orders figures. As they’re expected to show a contraction in orders the US Dollar could come under pressure on Wednesday.

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: Currency Predictions Pound Dollar Forecasts

Comments are currrently disabled