Last week’s high: $1.2966
Last week’s low: $1.2776
GBP/USD Falls as Spectre of Brexit Re-Emerges
The Pound US Dollar exchange rate remained volatile last week after Prime Minister Theresa May faced a humiliating defeat in Parliament on Thursday, dampening market confidence in Sterling.
The first half of the session saw the Pound weaken following the publication of the UK Q4 GDP figures, which fell to 0.2%
These were followed by the UK manufacturing production figures for December, which fell by -0.7%, further denting the GBP/USD exchange rate.
Tuesday, meanwhile, saw the Bank of England Governor, Mark Carney, allay some fears over Brexit, commenting that the UK could cooperate on a global scale and drawing in some bullish perspective for GBP traders.
The Pound started weakening in the second half of the week as the release of the UK consumer confidence figures slipped below expectation for January, dampening confidence in GBP on Wednesday.
Thursday, meanwhile, saw the Pound plummet following There May’s humiliating defeat in the Commons, with many GBP traders alarmed over increasing concerns of a possible no-deal Brexit.
The pairing closed the week with the Pound slipping against the US Dollar despite encouraging UK retail sales figures which exceeded expectation.
USD traders, meanwhile, were buoyed by the avoidance of another US government shutdown after President Donald Trump compromised – reluctantly – with Congress over security funding.
USD Outlook: Brexit in Focus as May under Increasing Pressure
Looking to the week ahead, it is likely that Brexit will once again remain in the spotlight, with Theresa May under more pressure after last week’s defeat in the House of Commons which undermined confidence in her Brexit strategy.
USD traders, meanwhile, will be focusing on President Donald Trump as political tensions once again mount following his threat to declare a national emergency in a bid to draw attention to problems around the Mexican border.
The Pound is likely to remain volatile this week as the clock ticks down for the UK’s Brexit date on 29 March, and with any signs of a no-deal, Sterling could plummet.
USD investors will be focusing on Thursday, which will see a raft of US data releases, and with any positive indications of an improving US economy, the GBP/USD exchange rate could fall.
09:30 ILO Unemployment Rate (Dec)
09:30 Average Earnings excluding bonus (Dec)
19:00 FOMC Minutes
09:30 Public Sector Net Borrowing (Jan)
13:30 Continuing Jobless Claims (Feb)
13:30 Markit Manufacturing PMI (Feb)
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Foreign Exchange Manager