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Pound Sterling News: GBP/USD Exchange Rate Rises 1.6% after BoE Meeting
Published: 1 Nov at 5 PM Tags: Pound Sterling, Dollar Exchange Rate, Currency Exchange, Euro Crisis, UK, Exchange Rates,
Pound Sterling to US Dollar Exchange Rate Up 1.6% on BoE Rate Hike Hopes
The Pound has recovered from a midweek slump against the US Dollar today, rising sharply against the US currency and most other peers.
This rise has been bipartite, with optimism about Brexit on Wednesday combining with a positive reaction to today’s Bank of England (BoE) meeting.
In the former case, a letter from Brexit Secretary Dominic Raab was interpreted as meaning that Brexit talks would conclude by 21st November.
Mr Raab later corrected these assumptions and dismissed the idea of such a rapid conclusion to Brexit talks, but the Pound still advanced against the US Dollar.
More recently, the latest BoE meeting has raised hopes for a 2019 interest rate hike (or several).
BoE policymakers left interest rates frozen at 0.75% but suggested that there could be a rate hike in 2019 even if the UK leaves the EU without a Brexit deal.
With some economists forecasting up to three rate hikes next year if there is a Brexit agreement, the Pound saw a rapid rise against the US Dollar after the meeting.
The future isn’t quite so bright in terms of UK economic data – Friday’s UK construction PMI data could lessen Pound Sterling demand if it shows a forecast-matching slowdown.
US Dollar Slides in Value after Manufacturing Sector Upset
The US Dollar has fallen heavily against the Pound and most other currency peers today, following the release of disappointing manufacturing PMI data.
Manufacturing sector readings from IHS Markit and ISM have both proven disappointing – ISM’s reading has fallen by more than forecast while Markit’s PMI hasn’t risen by as much as expected.
The US Dollar still has a chance to rise sharply against the Pound on Friday afternoon, when national unemployment rate and non-farm payrolls data is released.
The jobless rate is expected to remain at a historically low 3.7%, while the non-farm payrolls figure could reveal a sharp rise in the number of persons in employment.
The payrolls reading is often volatile, so an above-forecast rise could be all that it takes to cause a USD/GBP exchange rate rally.
The Pound has recovered from a midweek slump against the US Dollar today, rising sharply against the US currency and most other peers.
This rise has been bipartite, with optimism about Brexit on Wednesday combining with a positive reaction to today’s Bank of England (BoE) meeting.
In the former case, a letter from Brexit Secretary Dominic Raab was interpreted as meaning that Brexit talks would conclude by 21st November.
Mr Raab later corrected these assumptions and dismissed the idea of such a rapid conclusion to Brexit talks, but the Pound still advanced against the US Dollar.
More recently, the latest BoE meeting has raised hopes for a 2019 interest rate hike (or several).
BoE policymakers left interest rates frozen at 0.75% but suggested that there could be a rate hike in 2019 even if the UK leaves the EU without a Brexit deal.
With some economists forecasting up to three rate hikes next year if there is a Brexit agreement, the Pound saw a rapid rise against the US Dollar after the meeting.
The future isn’t quite so bright in terms of UK economic data – Friday’s UK construction PMI data could lessen Pound Sterling demand if it shows a forecast-matching slowdown.
US Dollar Slides in Value after Manufacturing Sector Upset
The US Dollar has fallen heavily against the Pound and most other currency peers today, following the release of disappointing manufacturing PMI data.
Manufacturing sector readings from IHS Markit and ISM have both proven disappointing – ISM’s reading has fallen by more than forecast while Markit’s PMI hasn’t risen by as much as expected.
The US Dollar still has a chance to rise sharply against the Pound on Friday afternoon, when national unemployment rate and non-farm payrolls data is released.
The jobless rate is expected to remain at a historically low 3.7%, while the non-farm payrolls figure could reveal a sharp rise in the number of persons in employment.
The payrolls reading is often volatile, so an above-forecast rise could be all that it takes to cause a USD/GBP exchange rate rally.
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Source: moneytransfer.co.uk