Welcome to Pure FX's latest update of the pound to US dollar interbank exchange rate.
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Sterling bounces back versus the greenback! The pound to US dollar interbank exchange rate has hit 1.3151 today, its highest in close to 1 week, or since July 17th.
The pound has strengthened against the US dollar, because US President Donald Trump has said in an interview that he's "not thrilled" that the Federal Reserve is lifting interest rates.
The greenback has weakened, because Mr. Trump told CNBC's Joe Kernen last week that "I am not happy" about America's central bank hiking interest rates above their current 2.0%.
Mr. Trump added that "I don’t like all of this work that we’re putting into the economy and then I see rates going up," thereby dragging down the buck on the currency markets.
This has weighed on the US dollar, because Mr. Trump's Trump's remarks raise the odds that the Fed will keep US interest rates low, thus making investing in the USA less profitable.
This has also hurt the greenback, because the US President's comments lift the chances that America's economy will overheat, if the Fed doesn't take action to raise borrowing costs!
US Dollar Declines, as Trump Threatens $500bn Tariffs on China
What's more, the pound to US dollar interbank exchange rate has also neared this 1-week high, because President Trump has threatened to impose a full $500bn of tariffs on China.
The US dollar has lost out, because speaking to CNBC's Joe Kernen last week, Mr. Trump said that "I'm ready to go to 500", the full amount that China imported to the USA last year.
Mr. Trump comments have weakened the greenback, because they tell us that the US President is prepared to greatly escalate his trade conflict with China, if he sees fit.
The US President's remarks have also dragged down the buck, because if Mr. Trump imposes $500bn of tariffs on China, China's goods in America will be costlier, thus a tax on Americans.
"Increasingly it looks difficult to duck trade blowback," according to Mizuho Bank's Vishnu Varathan, as Mr. Trump keeps ratcheting up his anti-China trade rhetoric, thus hurting the US dollar.
Given all this, the pound has reached this 1-week high versus the greenback, and could fly higher in coming weeks!
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Please bear in mind, this article is Pure FX’s opinion only and does not constitute advice. Moreover, the exchange rates referred to in this article are the interbank rates, which are the rates at which banks and financial institutions buy and sell currency to each other. Therefore these exchange rates cannot be accessed by individuals or SMEs, and are not the same rates that Pure FX can offer. To get a free exchange rate quote, call us on +44 (0) 1494 671800, or email [email protected]