December 14, 2018 - Written by John Cameron
STORY LINK Pound to US Dollar (GBP/USD) Exchange Rate News: ‘Greenback’ Strengthened by Safe Haven Status on China Economic Slowdown
GBP/USD Exchange Rate Falls as ‘Greenback’ Strengthened by China Economic Slow Down
The Pound US Dollar (GBP/USD) exchange rate is down today, and is currently trading at $1.2590 after USD was strengthened by safe-haven demand after China’s economy shows signs of slowing down.
Yesterday also saw the ‘Greenback’ strengthened by the release of the US Department of Labour’s initial jobless claims figures which showed a decrease at 206K against last month’s 233K.
GBP, meanwhile, was weakened by the release of the RICS housing price balance for November, which showed a decrease at -11% against the previous month’s -10%.
GBP/USD Exchange Rate Drops after Theresa May’s ‘Midnight Horror Show’ in Brussels
The Pound (GBP) strengthened yesterday on the news that British Prime Minister Theresa May had secured her position after a no-confidence vote.
However, doubts crept back in as Theresa May headed back to Brussels yesterday to renegotiate aspects of her deal, with the EC President Jean Claude Juncker commenting:
‘We can issue some clarifications but there will be no renegotiations.’
Sky News’ Political Editor, Faisal Islam, described Theresa May’s visit to Brussels yesterday as a ‘midnight horror show’, echoing a general lack of faith in May as she rallies to bolster support for her Brexit deal.
Looking ahead to next week, Monday will see the release of the Rightmove house price index for December, with Sterling investors taking note of any signs of a slowdown.
US Dollar Pound Sterling (USD/GBP) Exchange Rate Rises as USD Benefits from Safe-Haven Status
The US Dollar (USD) was bolstered by today’s news that the Chinese economy is slowing, benefiting from its safe-haven status.
This came after the release of weak Chinese industrial and retail figures which showed a significant slowing in the economy.
US President Donald Trump commented:
‘China’s economy, if it’s in trouble, it’s only in trouble because of me.’
USD, however, may be weakened by today’s raft of data releases, with the most significant being the retail figures for November which are expected to decrease.
GBP/USD Outlook: Brexit and US-China Trade Remain in Focus
The Pound US Dollar (GBP/USD) will likely be determined by political factors this week, with Theresa May continuing to rally support for her Brexit agreement.
USD investors will meanwhile be keeping an eye on US-China trade tensions, with any signs of progress likely to weaken the Dollar.
The US Dollar (USD) has also been strengthened as market attention turns to next week’s expected US interest rate hike.
The Pound (GBP) meanwhile will be affected by Wednesday’s slew of UK data releases, with the most notable being the retail price index for November.
Thursday, however, will see the main influential release for the GBP/USD exchange rate with the the Bank of England’s latest interest rate decision.
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TAGS: Pound Dollar Forecasts