Last week’s high: $1.3093
Last week’s low: $1.2868
US Dollar Slides on US-China Tension
The start of last week saw the GBP/USD exchange rate slip back from the $1.30 level as the UK saw both a weak construction and services PMI.
Tuesday saw the release of the US non-manufacturing PMI for January, which slipped below forecast, at 56.7, although this did little to stop the pairing falling.
The pairing continued to slide on comments made by the Federal Reserve’s Vice Chair, Randal Quarles, who stated:
‘The outlook is still very solid […] Everything we see, all the job numbers in particular, the labour market, is extremely solid labour market, and inflation pressures remain muted.’
The pairing shot up as the Bank of England held interest rates steady at 0.75%, with Governor Mark Carney sparking optimism by saying that following a soft Brexit ‘we’ll move forwards.’
The pairing rose again on Friday, likely due to President Donald Trump simply stating ‘no’ when asked if he would be meeting his Chinese counterpart, Xi Jinping before the 90-day US-China trade agreement is over, causing global risk sentiment to jump.
USD Outlook: Will Weak Retail Sales Growth Dent the Dollar?
The US Dollar could rise at the start of the week, with the UK preliminary GDP for Q4 forecast to slip to 0.1%, which may see the Pound dip.
January’s US Consumer Price Index (excluding food and energy) will also be released, and if the figures are robust we could see the GBP/USD pairing slide.
The session will end with the release of the US retail sales (excluding autos) for January, which are predicted to show a slower rate of growth compared to the previous month.
If retail sales growth shows a slower rate, or contracts it may see the pairing rise at the end of the session.
09:30 GBP GDP (Q4)
09:30 GBP Manufacturing Production (December)
09:30 GBP Industrial Production (December)
09:30 GBP Retail Price Index (January)
09:30 GBP Consumer Price Index (January)
13:30 USD Consumer Price Index Ex Food and Energy (January)
13:30 USD Initial Jobless Claims (8th February)
13:30 USD Continuing Jobless Claims (1st February)
15:00 USD Retail Sales ex Autos (December)
15:00 USD Retail Sales Control Group (December)
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Foreign Exchange Manager