Yesterday the rate of cable (GBP/USD) entered its worst losing streak since the financial crisis of 10-years ago, after the pair fell for the 11th consecutive day.
The Pound has dropped in value against other major currency pairs also but the drop against the US Dollar is the stand out pair, as fears surrounding the UK mount. Cable traded below 1.27 for the first time in 14-months on Wednesday after the pair hit 1.2669 yesterday morning.
Those converting their US Dollars into Pounds have seen a gain of 6% since the beginning of the year. At the moment the fears surrounding the UK economy focus on the Brexit deal and whether the UK and the EU will reach an agreement in time. Key figures within the UK Government (Liam Fox) have recently come out and suggested there is a 60% chance of a no-deal and this is seen as a negative for the Pound owing to the uncertainty created.
August is also regarding as a poor month for the Pound and the trend hasn’t helped Sterling exchange rates as we’ve seen the rate fall across the board.
Hopes for the Pound changing direction and climbing have dropped recently, mostly owing to the Brexit related fears. Just this month the Bank of England chose to hike interest rates and this has done little to boost Sterling’s value as our readers will have noticed. This is a sign of the times as usually interest rate hikes result in a strengthening of the underlying currency.
The next potential market mover will be the release of GDP data which is due out tomorrow. If you wish to be kept updated regarding this data release, do register your interest with us as working on a dealing floor allows us to react quickly. You can email me directly on email@example.com for further insight into the factors that could impact cable rates.
Also later today there will be Jobless Claims due out of the US which could move markets, and again do get in touch if you wish to be kept updated.