Welcome to Pure FX's latest update of the US dollar to pound interbank exchange rate. This tells you when it's an excellent time to exchange US dollars to pounds, for your money transfer!
The greenback flies high versus sterling! The US dollar to pound interbank exchange rate has reached its strongest in 7 months today, or since November 13th 2017, at 0.7601.
Given this, when you exchange US dollars for pounds, you'll get a higher pound total than any time since mid-November last year. Hence, this is an outstanding time to transfer money to the UK, whether you're importing and exporting for your business, or buying a UK property.
US Dollar Jumps, as US-China Trade Dispute Intensifies
The US dollar has jumped against the pound, because the trade dispute between the USA and China has escalated in the last day.
In particular, yesterday America said that it's considering imposing an extra $200 billion of trade tariffs on China, following the USA and China's decision to impose $50 billion of tariffs on each other at the weekend.
The USA is imposing these trade tariffs, because America accuses China of unfair trade practices and intellectual property theft, and to reduce America's -$376 billion a year trade deficit with China. As a result, the US dollar is flexing its muscles!
Greenback Rises, as Trade Dispute Lifts Demand for US Dollars as Safe Haven
The greenback is strutting its stuff following America's announcement that it's considering imposing extra tariffs on China for 2 reasons.
First, the USA and China's trade dispute destabilises the global economic status quo. In turn, this unnerves international money managers, who seek to shift their investments to stable, "safe haven" countries. The USA is the backbone of the world economy, and thus a "safe haven".
Given this, even though America is involved in this trade dispute, money managers are placing money in the USA as a "safe haven", thereby lifting the US dollar!
Buck Strengthens, as Trade Dispute May Lift US Inflation, Interest Rates
The buck has also strengthened against the pound following America's announcement, because if the USA imposes more tariffs on China, Chinese products in the USA will rise in price.
As a result, inflation in the USA will increase. Given this, America's central bank, the Federal Reserve, will come under pressure to lift US interest rates faster, above their current 2.0%.
When US interest rates rise, this makes investing in US financial assets more profitable for global money managers. Hence, as the USA and China's trade dispute could result in higher US interest rates, the buck is rising!
Pound Weakens, as Lords Vote for "Meaningful" Brexit Vote
What's more, the US dollar to pound interbank exchange rate has also strengthened, because earlier this week, the House of Lords rebelled against the UK government, and voted for Parliament to have a "meaningful" vote on Brexit.
To be specific, late on Monday the Lords voted for Parliament to be able to veto the UK government's final Brexit deal with the European Union, in March next year.
The vote was led by Tory MP and pro-EU rebel Dominic Grieve, who thinks that Parliament should decide the UK's post-Brexit deal, rather than the UK government. As a result, the pound fell.
Sterling Loses Out, as Lords Vote Complicates Brexit Outlook
Sterling has lost out following the House of Lords' vote for a "meaningful" Brexit deal, because the Lords' vote further complicates the outlook for Brexit.
For instance, Jasper Lawler, head of research at London Capital Group, says that “This will only test [UK prime minister Theresa] May’s ability to steer a minority government". In addition, Mr. Lawler says that "pro-EU rebels promise they can collapse the government if their demands aren’t met."
As a result, it may take the UK government longer to reach a favourable Brexit deal. This may weigh on UK GDP growth, and thus weakens sterling!
Given all this, the US dollar to pound interbank exchange rate has hit this 7-month high. Make the most of this excellent exchange rate to transfer your money from the USA to the UK, and get a far higher pound total!
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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 firstname.lastname@example.org.