Pound to US Dollar exchange rate breaks 1.24 for the first time in 7 weeks

Pound to US Dollar exchange rate breaks 1.24 for the first time in 7-weeks

Brexit update: DUP to side with the Government?

This morning the Pound has begun the day in strong fashion, and breached the 1.24 level after reaching as high as 1.2417 at its highest level so far.

After struggling to break the Brexit impasse since taking over at number 10, UK Prime Minister Boris Johnson was handed a lifeline last night when the Democratic Unionist Party of Northern Ireland last night suggested that it would accept Northern Ireland abiding by some EU rules after Brexit. Up until now the DUP has rejected such considerations and this has been key due to the DUP propping up the Conservative Party’s government.

This is the kind of breakthrough that could help to carry out Brexit in a more orderly fashion, which is perhaps why the Pound is up against all major currency pairs this morning after having quite a rough time in recent months.

Since Boris Johnson became Prime Minister the rate of cable (GBP/USD) has dropped to its lowest level in 3-years after hitting 1.1959 earlier this month as Sterling came under significant selling pressure. There has been a recovery from the currency since making the purchase of US Dollars using Pounds cheaper. UK politics remain a key driver of the Pounds value so if you’re monitoring the markets and plan on making a transfer involving the Pound do feel free to register your interest with us.

Will the US Federal Reserve cut interest rates

There are expectations for another interest rate cut from the Federal Reserve Bank in the US in the short term future, and this has resulted in a boost to US equity markets which has seen them trading close to all time highs at the moment. At the same time the US Dollar is coming under pressure as a rate cut will make it less attractive to hold funds in, and the Euro has also been gaining ground against the US Dollar as well as the Pound this week for this reason.

Later today there will be a number of releases out of the US at 1.30pm, mostly covering the US consumer so please feel free to get in touch if you wish to be updated. You can contact me using the form below. I look forward to hearing from you.