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Pound to US Dollar Exchange Rate Rallies after Fed Minutes Threaten Hopes of Near-Term Rate Hike
Published: 23 Feb at 5 PM Tags: Pound Sterling, Dollar Exchange Rate, Currency Exchange, Euro Crisis, UK, Exchange Rates,
Pound to US Dollar Advance Comes as Lords Near First Article 50 Amendment
The Pound US Dollar exchange rate has risen by 0.7% today, at a turbulent time in UK politics.
The House of Lords is busy debating the Article 50 bill, which previously passed through the House of Commons without amendment.
This may all be set to change in the near-term, however, as it seems an amendment to secure the rights of EU nationals after Brexit could be attached to the bill.
The Pound’s advance has come due to the implications of such an amendment being approved. With the status of EU citizens assured in the UK after Brexit, it may put the UK in a more favourable position during negotiations, owing to this apparent concession to other EU nations.
Looking to next week, key UK data will include a confidence score on Tuesday as well as PMI data from Wednesday to Friday.
Previously, the GfK consumer confidence score fell by -5 points, while UK sector PMIs all showed growth. For the Pound to remain strong against the US Dollar, a return to a positive score would help, along with signs of continued resilience in UK economic sectors after 2016’s referendum vote.
US Dollar Crashes on Fed Minutes, Uncertainty over Trump Policies
The US Dollar’s performance today has been generally poor all-around, with the -0.7% drop against the Pound being just one of many losses.
The main USD-influencing news today came late on Wednesday, when Federal Reserve minutes showed that policymakers were uncertain of what to make of new President Donald Trump.
While the minutes did indicate that a rate hike could be coming ‘fairly soon’, they also made it clear that policymakers were still cautious of changes in economic conditions, a statement interpreted as meaning Trump policies.
The President himself has pledged to unveil ‘phenomenal’ tax reforms in the future, something that has the potential to either boost demand for the US Dollar and raise Fed rate hike odds, or throw policymakers into uncertainty if they prove too ambitious or financially implausible.
More immediately, the next US data will be Friday afternoon’s new home sales figures for January, alongside a finalised University of Michigan confidence score. Sales are expected to rise from -10.4% to 7.2% in January, while confidence is forecast to be revised down from 98.5 to 96 points.
The Pound US Dollar exchange rate has risen by 0.7% today, at a turbulent time in UK politics.
The House of Lords is busy debating the Article 50 bill, which previously passed through the House of Commons without amendment.
This may all be set to change in the near-term, however, as it seems an amendment to secure the rights of EU nationals after Brexit could be attached to the bill.
The Pound’s advance has come due to the implications of such an amendment being approved. With the status of EU citizens assured in the UK after Brexit, it may put the UK in a more favourable position during negotiations, owing to this apparent concession to other EU nations.
Looking to next week, key UK data will include a confidence score on Tuesday as well as PMI data from Wednesday to Friday.
Previously, the GfK consumer confidence score fell by -5 points, while UK sector PMIs all showed growth. For the Pound to remain strong against the US Dollar, a return to a positive score would help, along with signs of continued resilience in UK economic sectors after 2016’s referendum vote.
US Dollar Crashes on Fed Minutes, Uncertainty over Trump Policies
The US Dollar’s performance today has been generally poor all-around, with the -0.7% drop against the Pound being just one of many losses.
The main USD-influencing news today came late on Wednesday, when Federal Reserve minutes showed that policymakers were uncertain of what to make of new President Donald Trump.
While the minutes did indicate that a rate hike could be coming ‘fairly soon’, they also made it clear that policymakers were still cautious of changes in economic conditions, a statement interpreted as meaning Trump policies.
The President himself has pledged to unveil ‘phenomenal’ tax reforms in the future, something that has the potential to either boost demand for the US Dollar and raise Fed rate hike odds, or throw policymakers into uncertainty if they prove too ambitious or financially implausible.
More immediately, the next US data will be Friday afternoon’s new home sales figures for January, alongside a finalised University of Michigan confidence score. Sales are expected to rise from -10.4% to 7.2% in January, while confidence is forecast to be revised down from 98.5 to 96 points.
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Source: moneytransfer.co.uk