The pound has hit the best level to buy US dollars in almost two months on Friday morning after news reports suggested that the UK could delay Brexit.
This helped the pound to break past 1.28 vs the US dollar on the Interbank level during Friday’s trading session creating some very good short term opportunities to buy US dollars with pounds.
Meanwhile, even though the NIESR confirmed that GDP expanded at its lowest pace in 6 months this did little to harm the value of the pound, which highlights how much of an effect the Brexit talks are having on the value of Sterling exchange rates across the board.
Dollar Weakness short lived owing to Brexit uncertainty
However, the US dollar then strengthened once again vs the pound as it appears as though investors are looking to take short term profits which caused the pound to drop back into the 1.27 levels on Friday afternoon.
On Friday afternoon US Inflation came out as expected at 1.9% and as this is line with what the Federal Reserve has already budgeted this allows the Federal Reserve to continue on their path of raising interest rates during the course of this year hence the continued Dollar strength.
As we look forward to next week we could see one of the biggest movements for GBPUSD exchange rates in recent months as the UK is due to vote on the current Brexit deal being offered.
What has been clear in recent times is that MPs are in favour of remaining and if the current deal is not agreed Theresa May will be given just 3 days to come up with an alternative.
This could result in a number of different options including the chance of a second referendum, a general election or even the extension of Article 50 which would all have a big influence on the value of the pound against the US dollar.
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