USD/GBP Rate & Comments for 10th August 2010

USD/GBP - 1.580

Sterling hit a daily high of $1.5998/£1 but slipped away as the pound yet again struggled to break through the $1.60/£1 barrier. Sterling strengthened as the fallout from Friday’s poor US jobs data continued to hammer the US dollar. With many financial options ready to trigger at the $1.60 level, as well as it being a key ‘psychological’ level there is a need for a large ‘boost’ for the pound to push through – and hold firm – away from the $1.50s. This week, we might have just that with the FOMC (the US equivalent of the Monetary Policy Committee) meeting getting under way yesterday evening. There is speculation that there may be further emergency funding injected into the US economy to help jumpstart the floundering economy. The decision is announced today. Aside from that, it was a quiet day on the economic calendar. Out later today, there is UK trade balance data and consumer confidence figures. Ensure you don’t miss out and call in now for a price.

In the USA, the fallout from last week’s unemployment data continues to cause issues for the US dollar. Speculation over further quantitative easing has been high today and with the FOMC meting starting late last night. No recovery occurs in a straight line, and a run of poor data does not necessarily instantly mean that the US is entering a ‘double-dip’ recession. Lloyds TSB are predicting that the UK will enter a similar phase in 6-12 months and that we will see prices back towards the $1.40s. Call in now to take advantage of current pricing.

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