Pound US Dollar (GBP/USD) Exchange Rate Flat as US GDP Prints at over 4%
UPDATE: US President Donald Trump will be congratulating himself after the latest quarterly GDP print saw a rise of 4.1%
Economists had forecast an increase of 4.1%, which would be the highest rate of growth since 2014, so today’s result was exactly in line with expectations.
In the immediate aftermath of the result the GBP/USD exchange rate rose slightly, erasing earlier losses.
GBP/USD Exchange Rate Declines after Reported Rise in US Goods Orders
UPDATE: The Pound Sterling US Dollar (GBP/USD) exchange rate has slumped this afternoon, putting Sterling down to $1.31 on the interbank exchange rate.
This deterioration follows the release of US durable goods orders data for July, which showed a 1% rise for the reported order count.
This missed forecasts for a 3% rise, but has still been good enough to push the US Dollar up in the pairing.
GBP/USD Exchange Rate Ticks Lower on Pound Sterling Trader Uncertainty
UPDATE: The Pound Sterling US Dollar (GBP/USD) exchange rate has continued to make minor losses today, falling to $1.31 on the interbank exchange rate.
This decline in value is down to GBP trader worries about upcoming US orders data, which threatens to cause additional GBP/USD losses.
If durable goods orders rise in line with forecasts today, then the positive implications of this news could send the US Dollar soaring against the Pound.
Risk of Turbulent UK-EU Split Causes GBP/USD Exchange Rate Losses
Pound Sterling (GBP) has seen minor losses against the US Dollar (USD) today following news that the UK government is planning to stockpile supplies in case of a bad Brexit deal.
Health Secretary Matt Hancock revealed that the government plans to stockpile medical supplies in case the UK’s supply lines are held up or disrupted by a poor Brexit deal.
While these plans are only intended as a safety net in the worst case scenario, the fact that the government is considering such a negative outcome has unsettled GBP traders and weakened the Pound.
US Dollar to Pound (USD/GBP) Exchange Rate Rises after Apparent US-EU Trade Truce
The US Dollar (USD) has risen slightly against the Pound (GBP) today, following Wednesday’s apparently fruitful US-EU meeting in the White House.
President Trump met with European Commission President Jean-Claude Juncker and appeared to reach an agreement on lowering trade barriers; this has raised USD trader confidence today.
It is thought that neither entity will seek to impose fresh trade tariffs and that existing tariffs on industrial goods will be reduced or removed.
Today’s USD/GBP Exchange Rate Gains Limited by Scepticism over US-EU Talks
Despite the market reaction, some economists have downplayed the importance of the recent US-EU trade talks; among them has been Alan Beattie of the Financial Times:
‘Some bits are … impossible and will have to be quietly forgotten to make a deal work, [like] ending all non-tariff barriers & non-auto industrial subsidies – this would mean wholesale dismantling of EU regulation.’
Pound to US Dollar Exchange Rate Forecast: Will GBP/USD Fall Further on US Orders Data?
The Pound is at risk of making additional losses against the US Dollar this afternoon, when US durable goods stats for June are released.
These are tipped to show a significant rise in reported orders during the previous month, with an increase from May’s -0.6% contraction up to 3% growth in June.
Such a rise in orders could be enough to push the US Dollar up in value, as this would suggest growing US consumer confidence and economic stability.
Friday’s economic data will also consist of US releases; the afternoon’s advance Q2 GDP reading has the potential to cause greater USD/GBP exchange rate gains if it rises as forecast.
The reading is tipped to increase from 2% growth in Q1 to 4.1% growth in Q2, a substantial improvement which might send USD trader confidence soaring.