US Dollar to British Pound (USD/GBP) Exchange Rate Higher, Sterling Loses Appeal
Yesterday the US Dollar fluctuated against several of its currency counterparts as domestic retail sales were shown to have increased by just 0.1 per cent in April, down from a positively revised increase of 1.5 per cent in March and considerably less than the monthly rise of 0.4 per cent anticipated.
If you're looking to make an international money transfer, we recommend TorFX.
The result added to the case for the Federal Reserve leaving interest rates at record lows and inspired modest ‘Greenback’ losses.
The safe-haven currency also lost some of its appeal as rallying stocks pushed investors towards higher-risk assets.
That being said, the US Dollar was able to strengthen against a struggling British Pound and pressured Euro on Wednesday.
During North American trading US data showed that MBA mortgage applications increased by 3.6 per cent in the week ending May 9th.
This followed a 5.3 per cent gain the previous week.
Meanwhile, the US producer price index showed that the prices paid to domestic factories/service providers climbed by the most for over a year in April.
The producer price index increased by 0.6 per cent – the most significant rise since autumn 2012. Economists had anticipated a 0.2 per cent month-on-month gain.
On the year, producer prices including food and energy were up 2.1 per cent versus expectations for a 1.7 per cent increase.
However, while the US consumer price index is due out tomorrow, investors aren’t expecting another strong result.
In the view of one industry expert; ‘I don’t expect to see anything like that in the CPI number tomorrow. The more immediate effect of this will be on second-quarter corporate profits.’
After the US report was published the USD/GBP exchange rate experienced modest movement. The Pound shed 0.32 per cent against the US Dollar today after UK employment figures failed to excite investors and the Bank of England delivered a neutral inflation report.
The ‘Greenback’ also remained stronger against the Euro as investors weighed up the odds of the European Central Bank introducing additional stimulus when it meets next month.
Yesterday Jens Weidmann, head of the German Bundesbank, said that the influential financial institution was behind the prospect of further fiscal support.
Tomorrow US Dollar movement could follow the release of the US consumer price index, initial jobless claims figures and industrial/manufacturing production data.
As it stands the US Dollar is trading against the British Pound in the region of 0.5960 and against the Euro in the region of 0.7297.