GBP/USD has fallen gradually through the last 24 hours and is now trading at new lows for the year. It’s come as a result of a much stronger dollar. In fact, it was the strongest of the major currencies yesterday, supported in part by the continued worries over trade, evidenced by the performance of US stocks early on in the New York session yesterday.
BoE Governor Carney spoke yesterday too, and although he didn’t really touch on monetary policy, he instead spoke about how global risks had increased and how the banks’ capital had risen in order to withstand any negative Brexit related impacts to the economy.
It can’t be a great sign that despite the MPC votes last week, showing that one other committee member had joined two other dissenters in voting for a rate hike at the last meeting, that GBP/USD is trading at lows for the year so far. It suggests it might not be long before cable falls below the big 1.30 figure. If UK data disappoints between now and August and should the dollar continue its momentum higher, then a break could come sooner rather than later.