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Sterling recovers after Federal Reserve announcement

Arron Morris Currency Broker - Sterling recovers after Federal Reserve announcementWritten by
Arron Morris
Senior Currency Broker
T: 01442 892 065

After Wednesday night’s Federal Reserve announcement the dollar rose across the board, pushing the GBP/USD cross down to $1.2840.

However, the pound managed to claw back the lost ground over the course of Thursday’s trading session after the latest UK Services PMI reading came in higher than forecast, leaving the currency pair trading at $1.2930 this morning. The recent Services numbers back up the positive Manufacturing and Construction PMI figures from earlier in the week, which have gone some way to soften the blow of the initial Brexit meetings and will increase calls for the Bank of England to raise interest rates in the near future.

GBP/USD exchange rate graph

What did the Federal Reserve say?

The U.S. central bank overlooked a poor first quarter of economic growth and instead focused on the positive state of the Labor Market. By doing so, they have left a June rate hike firmly on the cards, which seems to have given investors some extra confidence.

Will GBP/USD rise even higher?

As things stand it is a real possibility. The GBP/USD cross has risen over 6% since the middle of March and if the currency pair can break $1.30 there is every chance it will keep going.

If the Brexit negotiations run smoothly, Theresa May wins the election and the UK economy continues on its current trend, then the pound will have a solid foundation to rise against all the major currencies.

We also need to remember President Donald Trump. If he struggles to push through his tax reform (especially after failing with attempt to unwind Obama Care) it could cause the dollar to give up the gains it made following his surprise election victory.

Contact me today for a free consultation

If you have a requirement to buy or sell dollars in the coming months and are worried about how the Brexit negotiations could impact your transfer, contact me today for a free consultation.

As a specialist in currency exchange I have a number of tools at my disposal to help you maximise the return of your transfer or protect you against adverse market movements.

For more information about how I can help or to find out what rate I can offer, complete the contact form on the right-hand side of the page or call me directly on 0044 (0) 1442 892 065

Arron Morris
Senior Currency Broker
T: 01442 892 065

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