Politics will once again most likely be the main driver for GBP/USD rates, with Brexit still well and truly in focus for the pound, and Donald Trump and his global trade wars impacting the dollar too.
Once again it seems that the U.S is in stalemate with China at present, and this is not only leading to rising global uncertainty in the stock markets, but also a weakening of the perceived ‘riskier’ currencies that are attached to China, such as the Australian dollar.
It seem unlikely that we will see a resolution in the near term. Recent comments from Trump suggested that a meeting between Chinese President Xi Jinping and him would be unlikely, and this latest hint of no progress has slightly strengthened the dollar.
GBP/USD exchange rates are sitting just below 1.30 at the time of writing, and it is hard to put a real solid prediction on where rates may head over the week due to the ongoing Brexit talks.
It seems that Prime Minister Theresa May has now commented that she will be open to discussions with Jeremy Corbyn regarding his Brexit plans, which had been taken fairly well by the EU last week.
With this in mind, should they manage to make progress then the U.K could take one step closer to getting a deal agreed and this would be likely to push GBP/USD exchange rates back above and comfortably into the 1.30s.
On the flip side of this there is the chance that these talks and plans will not go well and that we could have further Brexit uncertainty, and possibly still have the possibility of a ‘no deal’ Brexit start to come back into the frame.
Any hint of stalls in talks or any heightened chance of a ‘no deal’ Brexit (which I still feel is very unlikely) would potentially lead to sterling weakening against the dollar and all major currencies.
If you have a large currency exchange to carry out involving the pound against the dollar or indeed any other major currency then you are welcome to get in touch to discuss the options available to you. There is also plenty of economic data out from the U.K and the U.S this week that you should be aware of, although it does not have the same impact on exchange rates due to the political news as mentioned above, it still can make a big difference to the cost of your exchange.
Feel free to get in touch with me directly by using the form below, I’ll be more than happy to get in touch to discuss your position.