Home Daily Commentaries The pound falls against the US dollar for the second consecutive day

The pound falls against the US dollar for the second consecutive day

Friday 7 October, 2022

Daily Currency Update

The pound has now declined against the US dollar for the second consecutive day. Yesterday's trading ended with GBP/USD back below $1.12, down over 1%. That’s the lowest level since Monday and puts the pound on track for two significant falls in a row and to be over 2% lower than the start of Wednesday. GBP/USD extended its losses to two-consecutive days after six days of gains, which had previously bolstered the pound towards 1.1500 levels, but now investors wait for today's highly significant US jobs data which could mount more pressure on the pound against the US dollar.

Key Movers

EUR/USD came under renewed pressure and declined to fresh daily lows below 0.9850 on Thursday. Comments from US Federal Reserve members on the policy outlook seem to be providing a boost to the US dollar and weighing on the currency pair. The US dollar has caused much uncertainty in global currency markets this week with traders grappling with whether the Federal Reserve will maintain its aggressive pace of interest rate hikes as it tries to curb inflation. Their more aggressive stance has sent the US dollar surging this year, however, concerns about slowing economic growth mean it could look to raise borrowing costs more slowly.

Expected Ranges

  • GBP/USD: 1.1185 - 1.1255 ▲
  • GBP/EUR: 1.1405 - 1.1465 ▲
  • EUR/USD: 0.9785 - 0.9875 ▲