Mixed US Non-Farm Payroll Report Helps GBP/USD Sustain Over a Cent in Gains

Last week’s high: $1.2346

Last week’s low: $1.1967

Softening Brexit Fears see Pound to US Dollar Rebound from Decade Worst

No-deal Brexit fears briefly intensified in the first half of last week with the Pound to US Dollar exchange rate touching on its worst level in a decade.

Efforts to prevent a no-deal Brexit along with three parliamentary defeats for Boris Johnson helped the Pound sustain a solid recovery between Tuesday and Thursday, though the rally lost momentum on Friday.

Positive developments in the US-China trade war have seen investors more willing to buy riskier currencies, and the latest key US data has been mixed. Both factors weighed on the US Dollar, clearing a path for GBP/USD exchange rates to advance throughout the week.


USD Outlook: Another Week of Brexit Chaos to Drive Currency Markets?

The potential remains for a significant shift in GBP/USD movement next week depending on developments in Brexit and UK politics.

If the British Parliament fails to prevent a no-deal Brexit, or an early snap election is confirmed, the Pound is likely to react negatively. Pound investors are also wary of speculation the Prime Minister may yet find a way to force his preferred no-deal outcome.

Major US data due this week includes inflation and retail sales, either of which could cause Federal Reserve interest rate cut bets to rise if they fall short of predictions. Increasing hopes for a resolution to the US-China trade situation could lead to divergent US Dollar weakness as investors turn to risk-sensitive currencies.



Key Events

9th September

UK Parliament Vote Preventing No-Deal Brexit

09:30 Growth Rate

10th September

09:30 UK Job Market Report

11th September

15:00 US Wholesale Inventories

12th September

13:30 US Inflation Rate

13th September

13:30 US Retail Sales

15:00 US Michigan Consumer Sentiment





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Alastair Archbold
Currency Trader
T: 01442 892 062