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GBP/USD Rocked by UK Political Turmoil

Last week’s high: $1.2296

Last week’s low: $1.2169

Pound Slips as No-Deal Brexit Risks Grow

The Pound US Dollar exchange rate faced a daunting week on the defence as markets reacted to Prime Minister Boris Johnson’s decision to prorogue parliament.

Parliament will now sit for just three weeks before the Brexit deadline passes. Sterling sentiment has soured amidst fears this increases odds the UK will crash out of Europe on October 31.

For USD investors the focus last week remained on US-China trade relations, with the US Dollar enjoying some support when tensions between the two powers appeared to ease.

USD Outlook: More Political Chaos Ahead?

Looking to the week ahead, UK politics should remain a significant catalyst for movement in the GBP/USD exchange rate as parliament reconvenes following the summer recess.

This week will likely see MPs scrambling to pass legislation to block a no-deal Brexit, with political headlines likely to overshadow the UK’s latest PMI figures.

The publication of US non-farm payrolls may boost the US Dollar next week if they print as robustly as forecast.

 

Key Events

2nd Sep

09:30 UK Manufacturing PMI (Aug)

3rd Sep

09:30 UK Construction PMI (Aug)

11:00 UK Parliament Reconvenes

15:00 US ISM Manufacturing PMI (Aug)

4th Sep

09:30 UK Services PMI (Aug)

13:30 US Trade Balance (Jul)

5th Sep

13:15 US ADP Employment Chance (Aug)

15:00 US ISM Non-Manufacturing PMI (Aug)

15:00 US Factory Orders (Jul)

6th Sep

13:30 US Non-Farm Payrolls (Aug)

 

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Alastair Archbold
Currency Trader
T: 01442 892 062

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