{"id":3852,"date":"2017-07-12T00:00:00","date_gmt":"2017-07-12T04:00:00","guid":{"rendered":"https:\/\/currencylive.com\/100170-gbp-usd-slide-continue\/"},"modified":"2017-07-12T00:00:00","modified_gmt":"2017-07-12T04:00:00","slug":"100170-gbp-usd-slide-continue","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/100170-gbp-usd-slide-continue\/","title":{"rendered":"Sterling Disappointment to Overshadow Trump Jr Emails?"},"content":{"rendered":"

Broad dollar weakness was not enough to halt the pound\u2019s slide on Tuesday. Sterling dropped from a high of $1.2927 to $1.2847, close to its low for the day. Sterling weakness came after investors were left disappointed by a Bank of England policymaker.<\/p>\n\n\n\n\n\n
What do these figures mean? <\/th>\n<\/tr>\n<\/thead>\n
\n

When measuring the value of a pair of currencies, one set equals 1 unit and the other shows the current equivalent. As the market moves, the amount will vary from minute to minute. <\/p>\n

For example, it could be written: 1 GBP = 1.28934 USD<\/em> <\/p>\n

Here, \u00a31 is equivalent to approximately $1.29. This specifically measures the pound\u2019s worth against the dollar. If the U.S. dollar amount increases in this pairing, it\u2019s positive for the pound.<\/em> <\/p>\n

Or, if you were looking at it the other way around: 1 USD = 0.77786 GBP<\/em> <\/p>\n

In this example, $1 is equivalent to approximately \u00a30.78. This measures the U.S. dollar\u2019s worth versus the British pound. If the sterling number gets larger, it\u2019s good news for the dollar.<\/em> <\/p>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table class=\"table table-bordered\">\n

The market had been looking eagerly towards influential BoE policymaker Ben Broadbent\u2019s speech in Aberdeen. This was expected to be an opportunity to asses whether Broadbent would be joining his other members and voting for an interest rate hike before the end of the year. However, Broadbent gave nothing away, opting to discuss the impacts of Brexit on trade rather than any reference to monetary policy. This was a classic case of the market getting ahead of itself and upping interest rate expectations without reason. When interest rate expectations drop so does the currency, which is what happened to the pound in the wake of Broadbent\u2019s speech.<\/p>\n

Pound traders will now be looking ahead to the UK wages report due this morning. This will give further insight as to whether wages are managing to catch up with inflation. Should wages growth continue to be anaemic, the pound could slip even lower. UK wages are predicted to have fallen to 1.8% from 2.1% in the previous month.<\/p>\n

<\/a>Political jitters rock the dollar<\/h2>\n

Meanwhile the U.S dollar was smashed on Tuesday against all its major peers, except the pound. President Trump\u2019s son released emails with British publicist Rob Goldstone, who offered to set up meetings with the Russian government to boost Trump\u2019s presidential campaign. This was to be done through documents that would allegedly incriminate Hillary Clinton and her own dealings with Russia.<\/p>\n

News of the scandal came during slow trading ahead of Janet Yellen\u2019s testimony before Congress and U.S. inflation and sent the dollar diving. It seems to be the first confirmation that an associate of Trump attended a meeting in the hope of being handed sensitive information from Russian officials.<\/p>\n\n\n\n\n\n
How does political risk have impact on a currency? <\/th>\n<\/tr>\n<\/thead>\n
Political risk drags on the confidence of consumers and businesses alike, which means both corporations and regular households are then less inclined to spend money. The drop in spending, in turn, slows the economy. Foreign investors prefer to invest their money in politically stable countries as well as those with strong economies. Signs that a country is politically or economically less stable will result in foreign investors pulling their money out of the country. This means selling out of the local currency, which then increases its supply and, in turn, devalues the money. <\/td>\n<\/tr>\n<\/tbody>\n<\/table class=\"table table-bordered\">\n

Today could well see pressure on the dollar continue as a recovery stemming from Yellen or inflation figures is looking unlikely, given that risk of disappointment is greater at each event.<\/p>\n

The market knows Yellen favours tighter monetary policy following recent rhetoric, so anything less when she appears before Congress will send the dollar lower. It would take an extreme change in tone from Yellen to see some upside on the buck. Secondly the inflation report, inflation in the U.S. has been soft recently. Even if inflation is higher in June, investors know that one month\u2019s worth of data doesn\u2019t constitute a trend and therefore any rally could be brief.<\/p>\n\n\n\n
\n


\nThis publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from TransferWise Inc., Currency Live or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date. Consult our risk warning<\/a> page for more details.<\/em><\/small><\/p>\n

This article was initially published on TransferWise.com from the same author. The content at Currency Live is the sole opinion of the authors and in no way reflects the views of TransferWise Inc.<\/em><\/small><\/p>\n","protected":false},"excerpt":{"rendered":"

Broad dollar weakness was not enough to halt the pound\u2019s slide on Tuesday. Sterling dropped from a high of $1.2927 to $1.2847, close to its low for the day. Sterling weakness came after investors were left disappointed by a Bank of England policymaker. What do these figures mean? When measuring the value of a pair […]<\/p>\n","protected":false},"author":163946597,"featured_media":3853,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1379,1381],"tags":[1394,1398],"class_list":{"0":"post-3852","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-gbp","8":"category-usd","9":"tag-gbp","10":"tag-usd"},"acf":[],"yoast_head":"\nSterling Disappointment to Overshadow Trump Jr Emails? - Currency Live<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/currencylive.com\/news\/100170-gbp-usd-slide-continue\/\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Fiona Cincotta\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100170-gbp-usd-slide-continue\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100170-gbp-usd-slide-continue\\\/\"},\"author\":{\"name\":\"Fiona Cincotta\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"headline\":\"Sterling Disappointment to Overshadow Trump Jr Emails?\",\"datePublished\":\"2017-07-12T04:00:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100170-gbp-usd-slide-continue\\\/\"},\"wordCount\":826,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100170-gbp-usd-slide-continue\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100170-gbp-usd-slide-continue.jpg\",\"keywords\":[\"gbp\",\"usd\"],\"articleSection\":[\"GBP\",\"USD\"],\"inLanguage\":\"en-US\",\"copyrightYear\":\"2017\",\"copyrightHolder\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#organization\"}},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100170-gbp-usd-slide-continue\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100170-gbp-usd-slide-continue\\\/\",\"name\":\"Sterling Disappointment to Overshadow Trump Jr Emails? 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