Daily Currency Update

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Sterling falls further

GBP - British Pound

The pound suffered another round of losses yesterday against the US dollar and euro. Recent UK headlines have dominated sterling movement with gas prices rising, fuel stations being bombarded, weakening growth, and rising inflation. These conditions increase the risk of stagflation. Markets are looking to the Bank of England’s monetary policy committee to see how they could respond to protect the UK economy.

GBP/USD was as high as 1.3710 on Tuesday morning but reached a session low of around 1.3417 yesterday.

Key Movers

The US dollar surged again yesterday against major currencies. It was boosted by increased market expectations for a reduction in the U.S. Federal Reserve's asset purchases starting in November, and an interest rate hike, possibly in late 2022. Despite an impasse in Washington over the US debt ceiling that threatened to plunge the government into a shutdown, the USD has strengthened in recent days. Investors moved to the safe haven US dollar in response to fears of a global slowdown and a rise in energy prices.

USD/EUR has jumped back above 0.8600 which was last seen in July 2020. USD/AUD pushed above 1.3900 yesterday and USD/NZD above 1.4550. These were both last seen back in August 2021.

Expected Ranges

GBP/USD: 1.3370 - 1.3480 ▼

GBP/EUR: 1.1520 - 1.1590 ▼

GBP/AUD: 1.8610 - 1.8720 ▼

GBP/NZD: 1.9440 - 1.9610 ▼

EUR/USD: 1.1540 - 1.1680 ▼