Political uncertainty causes Pound to fall vs the US Dollar
The pound to US dollar exchange rate has fallen once again to below 1.20 after fresh fears over Brexit. There is now less than two months to go before the Brexit deadline and we face the threat of a general election being called in the short term.
The pound to US dollar rate is now trading at its lowest level since October 2016 which is good news for anyone looking to sell US dollars to buy sterling. Tonight, Boris Johnson will face parliament in an attempt to unite the party. Many MPs have already come together to block a no-deal Brexit and this means Johnson will try and get the party to unite. If Johnson does not manage to get the party to all agree then we face the threat of having a general election on 14th October if MPs manage to seize control of the House of Commons. This could also result in Brexit being delayed until the end of January 2020 unless a different deal or a no deal can be agreed by 19th October.
Further losses ahead for GBP/USD rates?
The real issue for sterling exchange rates is that there is so much uncertainty. Historically this is what tends to negatively impact the currency involved.
We end the week with US unemployment data in the form of Non-Farm Payroll data for August. If this comes out better than expected we could see even further improvements for the US dollar vs the pound towards the end of the week. There could be further losses ahead for GBP/USD rates so if you’re considering buying US Dollars with Pounds in the short term it may be worth getting this organised soon.
If you would like a free quote when buying or selling US dollars and would like to compare rates against your bank or other foreign exchange provider, then feel free to contact me directly and I look forward to hearing from you.