Last week’s high: $1.3315
Last week’s low: $1.3021
Brexit Chaos Hammers Sterling
The Pound US Dollar exchange rate fell back last week as Sterling came under fire amidst renewed Brexit jitters.
This was largely driven by Theresa May’s decision to only seek a short extension to Brexit, as well as rising concerns that the UK could still be facing a no-deal Brexit.
Meanwhile, the US Dollar was able to take advantage of the uncertainty as skittish investors flocked to the safe-haven currency.
However, somewhat capping USD gains mid-week was a dovish shift from the Federal Reserve, with the US central bank slashing its growth forecasts for 2019 whilst also signalling that interest rates are unlikely to rise this year.
USD Outlook: Brexit to Dominate GBP Sentiment as Parliament Faces as Third Vote
Looking to the week ahead, expect to see further volatility in the Pound as investors remain preoccupied by Brexit as parliament faces a third vote on May’s withdrawal deal.
Analysts warn of heavy losses in Sterling this week if the deal is voted down as expected, as it increases the chances of a no-deal Brexit.
Meanwhile the focus for USD investors is likely to be on the latest round of US-China trade talks amid hopes the two superpowers may be close to finalising a deal.
09:30 UK Mortgage Approvals (Feb)
11:00 UK CBI Distributive Trades (Mar)
12:30 US Trade Balance (Jan)
12:30 US GDP (Q4)
09:30 UK GDP (Q4)
09:30 UK Business Investment (Q4)
12:30 US PCE Price Index (Feb)
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