USD/GBP Rate & Comments for 19th August 2010
USD/GBP - 1.552
Sterling recovered from 3 week lows against the US dollar after the Bank of England’s minutes from their most recent monetary policy meeting eased market speculation that the Bank would loosen monetary policy further. Sterling rose to hit a daily high of $1.5689/£1 after hitting $1.5498/£1 as speculation grew that the Bank had discussed adding further emergency funding to the economy. However, the Bank kept rates and the Asset Purchase Facility on hold and briefly discussed expanding the £200bn in the economy if it was needed, but none of the rate setters voted for any expansion in the programme. Lone member Andrew Sentance yet again called for a 0.25% interest rate hike for the 3rd month in a row. That was the only data out yesterday of importance – out today there is key monthly retail sales data which is expected to show a slight decline after last month’s World Cup related boost to retail sales. Get in touch now for a live exchange rate and to ensure you don’t lose out if the data doesn’t come in as expected.

In the USA, the US dollar strengthened against the Japanese yen this morning as investors wait to see whether the Japanese government will take measures to rein in the strength of the currency. With yen in high demand when investors are looking for safe currencies to hold, the Japanese currency has appreciated in value as demand grows. However, with an export led economy, a strong currency makes goods less attractive so there has been speculation that the Japanese government may devalue the currency with a round of Quantitative Easing. In the USA, there is unemployment claims data and manufacturing data released later on – ensure you plan your next payment effectively by speaking to a trader today.
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