7 week high buying US dollars with pounds; Where next for GBPUSD exchange rates?

Will the Pound to US Dollar rate hit an annual low this month?

Will GBPUSD rates rise further?

GBPUSD exchange rates have risen lately following optimism about the outlook on Brexit and concerns over the impact of rising Trade War issues. Whilst the US Federal Reserve is expected to raise interest rates next week, there is still scope for the US dollar to lose further ground ahead.

Investors’ concerns relating to the US dollar stem from worries over the negative impact on the US economy from the Trade Wars, and a belief that perhaps the US is getting towards a peak level of interest rates. To raise rates any higher once they reached this peak could end up being detrimental to the US economy.

Hurricane Florence hits US economy

Whilst the Fed should raise interest rates next week when they meet on the 26th of September, there is scope for the recent turn of weather events in the US from Hurricane Florence to put an end to some of the recent strength we have seen for the US dollar.

Expectations for the pound to rise further against the US dollar could stem from the recent weakness of USD, and also the possibility of some progress on Brexit. The EU Summit in Austria concludes today and sterling has remained very sensitive to the news, rising and falling on each headline coming out.

Sterling not out of the woods just yet

The market is being led to believe that October or November will be the key dates on the pairing, as this is when the UK will really need to be finalising plans with the EU. I do not think the worst is over for the pound and the Conservative Party Conference next week could also prove a sticking point for the pound and for Mrs May.

If you have a currency transfer involving the pound or US dollar, the rates remain choppy. The current 7-week highs for those buying US dollars with pounds may not last long. If you have a transfer buying or selling US dollars and would like information to help finalise a decision or to check your exchange rate, then please do not hesitate to get in touch using the form below. I’ll be happy to contact your personally and discuss your questions.