Last week’s high: $1.2930
Last week’s low: $1.2731
GBP/USD Boosted by Cautious Fed Outlook
Last week saw the Pound rise against the US Dollar and close around $1.2844 on Friday.
In the UK, the government revealed its no-deal Brexit plans. Analysts gave a mixed reception to the measures and Chancellor Philip Hammond reiterated the dangers of a bad Brexit deal.
US Dollar traders had a late-week shock when Federal Reserve policymaker James Bullard suggested that interest rates were ‘very close to neutral’, implying few future rate hikes.
Mr Bullard will vote on interest rates in 2019, so this was seen as a dovish precursor to future rate decisions.
Chance of USD Rally on GDP Data
On a shorter-than-usual week, GBP/USD exchange rate movement is most likely to be driven by US news.
The main event is Wednesday’s US Q2 GDP estimate – forecasts are for economic growth to have rocketed from 2.2% to 4%. Such results could bring a mid-week USD rally.
Further USD support could come if personal incomes and spending levels are reported higher on Thursday, while Friday’s UK consumer confidence reading might exacerbate existing GBP/USD losses if it shows growing pessimism.
13:30 US GDP Growth Second Estimate (Q2)
13:30 US Personal Income and Spending
00:01 UK GfK Consumer Confidence
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Senior Currency Broker