{"id":4372,"date":"2018-03-01T00:00:00","date_gmt":"2018-03-01T05:00:00","guid":{"rendered":"https:\/\/currencylive.com\/100374-gbp-usd-us-hawkishp-powell\/"},"modified":"2018-03-01T00:00:00","modified_gmt":"2018-03-01T05:00:00","slug":"100374-gbp-usd-us-hawkishp-powell","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/","title":{"rendered":"GBP\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar"},"content":{"rendered":"<p>Brexit fears and hopes of more interest rate hikes in the US sent the pound US dollar exchange rate diving on Wednesday. The pound dropped over 1.1% versus the dollar, taking the exchange rate to US$1.3750. This is the lowest that the pound has traded versus the dollar in 6 weeks.<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th>What do these figures mean? <\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>\n<p> 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<p> For example, it could be written: <em>1 GBP = 1.28934 USD<\/em> <\/p>\n<p> <em>Here, \u00a31 is equivalent to approximately $1.29. This specifically measures the pound\u2019s worth against the dollar. If the US dollar amount increases in this pairing, it\u2019s positive for the pound.<\/em> <\/p>\n<p> Or, if you were looking at it the other way around: <em>1 USD = 0.77786 GBP<\/em> <\/p>\n<p> <em>In this example, $1 is equivalent to approximately \u00a30.78. This measures the US 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<p>The pound managed to hold its ground reasonably well in early trade, despite weak data. Data showed that UK Consumer confidence fell to -10 in February, down from -9 in January. Although falling consumer confidence is not good for the economy, the reading was in line with analysts expectations so the impact on the pound was minimal.<\/p>\n<p>Brexit headlines caused the pound to plummet. Pound traders have been getting nervous over the lack of progress in Brexit talks, which have stalled once again over the Northern Ireland border issue. UK Prime Minister Theresa May, flatly rejected the only option covering the Irish border in the European Commission\u2019s draft Article 60 Treaty. Here the EU proposes that Northern Ireland remains under EU rule, in order to prevent a hard border between Northern and Southern Ireland. The fact that there is considerable distance between the EU and the UK\u2019s negotiating positions still and that there doesn\u2019t appear to be a logical answer to the Irish border issue without discussing trade deals first, means negotiators could struggle to hit the deadline in three weeks\u2019 time. Should no transition deal go ahead, the UK could be heading for a hard Brexit, which would be the worst-case scenario for the pound.<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th>Why is a \u201csoft\u201d Brexit better for sterling than a \u201chard\u201d Brexit? <\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>A soft Brexit implies anything less than UK\u2019s complete withdrawal from the EU. For example, it could mean the UK retains some form of membership to the European Union single market in exchange for some free movement of people, i.e. immigration. This is considered more positive than a \u201chard\u201d Brexit, which is a full severance from the EU. The reason \u201csoft\u201d is considered more pound-friendly is because the economic impact would be lower. If there is less negative impact on the economy, foreign investors will continue to invest in the UK. As investment requires local currency, this increased demand for the pound then boosts its value. <\/td>\n<\/tr>\n<\/tbody>\n<\/table class=\"table table-bordered\">\n<h2><a href=\"#dollar-powers-higher\" name=\"dollar-powers-higher\"><\/a>Dollar Powers Higher<\/h2>\n<p>The dollar continued to charge higher in the previous session, helped along by Fed Powell\u2019s <a href=\"https:\/\/transferwise.com\/us\/blog\/hawkish-dovish-fx-definition\">hawkish <\/a>comments earlier in the week. The new Fed Chair expressed his optimism towards the US economy and hinted strongly towards raising interest rates more than the three times that his predecessor had planned. As investors adjusted their perceived odds of more rate hikes upwards, the value of the dollar rose.<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th>Why do raised interest rates boost a currency\u2019s value? <\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td>Interest rates are key to understanding exchange rate movements. Those who have large sums of money to invest want the highest return on their investments. Higher interest rate environments tend to offer higher yields. So, if the interest rate or at least the interest rate expectation of a country is relatively higher compared to another, then it attracts more foreign capital investment. Large corporations and investors need local currency to invest. More local currency used then boosts the demand of that currency, pushing the value higher. <\/td>\n<\/tr>\n<\/tbody>\n<\/table class=\"table table-bordered\">\n<p>Even news that fourth quarter growth in the US economy was being revised down slightly to 2.5% from 2.6% was insufficient to pull the dollar down of its highs.<\/p>\n<p>Today investors will be looking to US inflation data to see if markets fear of an increase in inflation are starting to play out. If inflation comes in higher then the dollar could rally higher.<\/p>\n<table class=\"table table-bordered\">\n<tbody>\n<tr>\n<td>\n<p><small><em><br \/>\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 <a href=\"https:\/\/currencylive.com\/risk-warning\/\">risk warning<\/a> page for more details.<\/em><\/small><\/p>\n<p><small><em>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":"<p>Brexit fears and hopes of more interest rate hikes in the US sent the pound US dollar exchange rate diving on Wednesday. The pound dropped over 1.1% versus the dollar, taking the exchange rate to US$1.3750. This is the lowest that the pound has traded versus the dollar in 6 weeks. What do these figures [&hellip;]<\/p>\n","protected":false},"author":163946597,"featured_media":4373,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1379,1381],"tags":[1394,1398],"class_list":["post-4372","post","type-post","status-publish","format-standard","has-post-thumbnail","category-gbp","category-usd","tag-gbp","tag-usd"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v28.0 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>GBP\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar - 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\/100374-gbp-usd-us-hawkishp-powell\/\" \/>\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\\\/100374-gbp-usd-us-hawkishp-powell\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/\"},\"author\":{\"name\":\"Fiona Cincotta\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"headline\":\"GBP\\\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar\",\"datePublished\":\"2018-03-01T05:00:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/\"},\"wordCount\":889,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100374-gbp-usd-us-hawkishp-powell.jpg\",\"keywords\":[\"gbp\",\"usd\"],\"articleSection\":[\"GBP\",\"USD\"],\"inLanguage\":\"en-US\",\"copyrightYear\":\"2018\",\"copyrightHolder\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#organization\"}},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/\",\"name\":\"GBP\\\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar - Currency Live\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100374-gbp-usd-us-hawkishp-powell.jpg\",\"datePublished\":\"2018-03-01T05:00:00+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"breadcrumb\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/#primaryimage\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100374-gbp-usd-us-hawkishp-powell.jpg\",\"contentUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100374-gbp-usd-us-hawkishp-powell.jpg\",\"width\":725,\"height\":400,\"caption\":\"GBP\\\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100374-gbp-usd-us-hawkishp-powell\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/currencylive.com\\\/news\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"GBP\\\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#website\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/\",\"name\":\"Currency Live\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/currencylive.com\\\/news\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Person\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\",\"name\":\"Fiona Cincotta\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/79afd1dde0d7ad291707268bbcdb9fdb41b2dd29f8088c8cfe9c67cd2a1de0e4?s=96&d=blank&r=g\",\"url\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/79afd1dde0d7ad291707268bbcdb9fdb41b2dd29f8088c8cfe9c67cd2a1de0e4?s=96&d=blank&r=g\",\"contentUrl\":\"https:\\\/\\\/secure.gravatar.com\\\/avatar\\\/79afd1dde0d7ad291707268bbcdb9fdb41b2dd29f8088c8cfe9c67cd2a1de0e4?s=96&d=blank&r=g\",\"caption\":\"Fiona Cincotta\"},\"description\":\"Editor - Senior Financial Market Analyst Through over a decade\u2019s experience analysing and reporting on global currency markets, Fiona has a gained a deep understanding of the fundamental drivers of currencies. She is regularly quoted by international news organisations including Financial Times, Reuters and Bloomberg. Fiona is a familiar face after years of appearances on BBC, Sky News and Fox Business News.\",\"sameAs\":[\"https:\\\/\\\/www.linkedin.com\\\/in\\\/fiona-cincotta-bb4a4845\\\/\"],\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/author\\\/fiona-cincotta\\\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"GBP\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar - Currency Live","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/","twitter_misc":{"Written by":"Fiona Cincotta","Est. reading time":"4 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/#article","isPartOf":{"@id":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/"},"author":{"name":"Fiona Cincotta","@id":"https:\/\/currencylive.com\/news\/#\/schema\/person\/8ef0fafb6c93f1204150bb907b42cfec"},"headline":"GBP\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar","datePublished":"2018-03-01T05:00:00+00:00","mainEntityOfPage":{"@id":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/"},"wordCount":889,"image":{"@id":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/#primaryimage"},"thumbnailUrl":"https:\/\/currencylive.com\/news\/wp-content\/uploads\/2019\/08\/100374-gbp-usd-us-hawkishp-powell.jpg","keywords":["gbp","usd"],"articleSection":["GBP","USD"],"inLanguage":"en-US","copyrightYear":"2018","copyrightHolder":{"@id":"https:\/\/currencylive.com\/news\/#organization"}},{"@type":"WebPage","@id":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/","url":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/","name":"GBP\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar - Currency Live","isPartOf":{"@id":"https:\/\/currencylive.com\/news\/#website"},"primaryImageOfPage":{"@id":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/#primaryimage"},"image":{"@id":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/#primaryimage"},"thumbnailUrl":"https:\/\/currencylive.com\/news\/wp-content\/uploads\/2019\/08\/100374-gbp-usd-us-hawkishp-powell.jpg","datePublished":"2018-03-01T05:00:00+00:00","author":{"@id":"https:\/\/currencylive.com\/news\/#\/schema\/person\/8ef0fafb6c93f1204150bb907b42cfec"},"breadcrumb":{"@id":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/#primaryimage","url":"https:\/\/currencylive.com\/news\/wp-content\/uploads\/2019\/08\/100374-gbp-usd-us-hawkishp-powell.jpg","contentUrl":"https:\/\/currencylive.com\/news\/wp-content\/uploads\/2019\/08\/100374-gbp-usd-us-hawkishp-powell.jpg","width":725,"height":400,"caption":"GBP\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar"},{"@type":"BreadcrumbList","@id":"https:\/\/currencylive.com\/news\/100374-gbp-usd-us-hawkishp-powell\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/currencylive.com\/news\/"},{"@type":"ListItem","position":2,"name":"GBP\/USD: Hawkish Powell Sends Pound Tumbling vs. Dollar"}]},{"@type":"WebSite","@id":"https:\/\/currencylive.com\/news\/#website","url":"https:\/\/currencylive.com\/news\/","name":"Currency Live","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/currencylive.com\/news\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/currencylive.com\/news\/#\/schema\/person\/8ef0fafb6c93f1204150bb907b42cfec","name":"Fiona Cincotta","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/secure.gravatar.com\/avatar\/79afd1dde0d7ad291707268bbcdb9fdb41b2dd29f8088c8cfe9c67cd2a1de0e4?s=96&d=blank&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/79afd1dde0d7ad291707268bbcdb9fdb41b2dd29f8088c8cfe9c67cd2a1de0e4?s=96&d=blank&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/79afd1dde0d7ad291707268bbcdb9fdb41b2dd29f8088c8cfe9c67cd2a1de0e4?s=96&d=blank&r=g","caption":"Fiona Cincotta"},"description":"Editor - Senior Financial Market Analyst Through over a decade\u2019s experience analysing and reporting on global currency markets, Fiona has a gained a deep understanding of the fundamental drivers of currencies. She is regularly quoted by international news organisations including Financial Times, Reuters and Bloomberg. Fiona is a familiar face after years of appearances on BBC, Sky News and Fox Business News.","sameAs":["https:\/\/www.linkedin.com\/in\/fiona-cincotta-bb4a4845\/"],"url":"https:\/\/currencylive.com\/news\/author\/fiona-cincotta\/"}]}},"jetpack_featured_media_url":"https:\/\/currencylive.com\/news\/wp-content\/uploads\/2019\/08\/100374-gbp-usd-us-hawkishp-powell.jpg","amp_enabled":true,"_links":{"self":[{"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/posts\/4372","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/users\/163946597"}],"replies":[{"embeddable":true,"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/comments?post=4372"}],"version-history":[{"count":0,"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/posts\/4372\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/media\/4373"}],"wp:attachment":[{"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/media?parent=4372"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/categories?post=4372"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/tags?post=4372"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}