{"id":4428,"date":"2018-03-21T00:00:00","date_gmt":"2018-03-21T04:00:00","guid":{"rendered":"https:\/\/currencylive.com\/100402-gbp-usd-us-fed-rate-decision\/"},"modified":"2018-03-21T00:00:00","modified_gmt":"2018-03-21T04:00:00","slug":"100402-gbp-usd-us-fed-rate-decision","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/","title":{"rendered":"GBP\/USD: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision"},"content":{"rendered":"

The pound dropped lower versus the US dollar on Tuesday after UK inflation data missed expectations. The pound US dollar exchange rate moved lower and hovered around $1.40, a key psychological level.<\/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 US 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 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

Data from the Office for National Statistics showed that inflation in the UK was finally easing lower. After 5 months of elevated inflation at 3% or higher, inflation, as measured by the Consumer Price Index <\/a>(CPI) finally pulled lower. CPI printed at 2.7% in February, lower than the 2.8% predicted by analysts, whilst core inflation which removes more volatile items such as food and fuel, increased at 2.4% year on year, below the 2.5% anticipated, whilst falling rom 2.7% the previous month.<\/p>\n

This pulling back in inflation will give the Bank of England some breathing space. The Bank of England had increased interest rates in November in an attempt to control runaway inflation. The central bank was considering raising interest rates again in May. However, weaker than forecast inflation will man that they can comfortably sit on their hands and wait to see how the inflation picture develops, before jumping into any course of action. As the possibility of a rate rise was pushed back, the pound dropped.<\/p>\n\n\n\n\n\n
Why do raised interest rates boost a currency\u2019s value? <\/th>\n<\/tr>\n<\/thead>\n
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

Today investors will look towards labour data and more particularly average wage data to see whether the gap between wages and inflation is closing. Should the numbers show the gap is closing the pound could receive a boost.<\/p>\n

<\/a>Dollar Higher Ahead Of FOMC<\/h2>\n

The dollar traded steadily higher in the previous session as investors look cautiously optimistically ahead to the Federal Reserve\u2019s interest rate decision at 18:00 GMT today. Analysts are widely expecting the Fed to hike rates by 25 basis points. In fact, the market is assuming a 94% probability that the Fed will hike rates.<\/p>\n

Market participants will be particularly interested to see whether the Federal Reserve will keep the current forecast of three rate hikes across the year, or whether the Fed under new Chair Jerome Powell will look towards a more aggressive path of rate hikes. Any increase in the number of rate rises forecast for the year ahead could boost the dollar.<\/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":"

The pound dropped lower versus the US dollar on Tuesday after UK inflation data missed expectations. The pound US dollar exchange rate moved lower and hovered around $1.40, a key psychological level. What do these figures mean? When measuring the value of a pair of currencies, one set equals 1 unit and the other shows […]<\/p>\n","protected":false},"author":163946597,"featured_media":4429,"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-4428","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":"\nGBP\/USD: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision - 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\/100402-gbp-usd-us-fed-rate-decision\/\" \/>\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\\\/100402-gbp-usd-us-fed-rate-decision\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100402-gbp-usd-us-fed-rate-decision\\\/\"},\"author\":{\"name\":\"Fiona Cincotta\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"headline\":\"GBP\\\/USD: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision\",\"datePublished\":\"2018-03-21T04:00:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100402-gbp-usd-us-fed-rate-decision\\\/\"},\"wordCount\":729,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100402-gbp-usd-us-fed-rate-decision\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100402-gbp-usd-us-fed-rate-decision.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\\\/100402-gbp-usd-us-fed-rate-decision\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100402-gbp-usd-us-fed-rate-decision\\\/\",\"name\":\"GBP\\\/USD: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision - Currency Live\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100402-gbp-usd-us-fed-rate-decision\\\/#primaryimage\"},\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100402-gbp-usd-us-fed-rate-decision\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100402-gbp-usd-us-fed-rate-decision.jpg\",\"datePublished\":\"2018-03-21T04:00:00+00:00\",\"author\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"breadcrumb\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100402-gbp-usd-us-fed-rate-decision\\\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/currencylive.com\\\/news\\\/100402-gbp-usd-us-fed-rate-decision\\\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100402-gbp-usd-us-fed-rate-decision\\\/#primaryimage\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100402-gbp-usd-us-fed-rate-decision.jpg\",\"contentUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100402-gbp-usd-us-fed-rate-decision.jpg\",\"width\":725,\"height\":400,\"caption\":\"GBP\\\/USD: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision\"},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100402-gbp-usd-us-fed-rate-decision\\\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\\\/\\\/currencylive.com\\\/news\\\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"GBP\\\/USD: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision\"}]},{\"@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: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision - 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\/100402-gbp-usd-us-fed-rate-decision\/","twitter_misc":{"Written by":"Fiona Cincotta","Est. reading time":"4 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/#article","isPartOf":{"@id":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/"},"author":{"name":"Fiona Cincotta","@id":"https:\/\/currencylive.com\/news\/#\/schema\/person\/8ef0fafb6c93f1204150bb907b42cfec"},"headline":"GBP\/USD: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision","datePublished":"2018-03-21T04:00:00+00:00","mainEntityOfPage":{"@id":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/"},"wordCount":729,"image":{"@id":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/#primaryimage"},"thumbnailUrl":"https:\/\/currencylive.com\/news\/wp-content\/uploads\/2019\/08\/100402-gbp-usd-us-fed-rate-decision.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\/100402-gbp-usd-us-fed-rate-decision\/","url":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/","name":"GBP\/USD: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision - Currency Live","isPartOf":{"@id":"https:\/\/currencylive.com\/news\/#website"},"primaryImageOfPage":{"@id":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/#primaryimage"},"image":{"@id":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/#primaryimage"},"thumbnailUrl":"https:\/\/currencylive.com\/news\/wp-content\/uploads\/2019\/08\/100402-gbp-usd-us-fed-rate-decision.jpg","datePublished":"2018-03-21T04:00:00+00:00","author":{"@id":"https:\/\/currencylive.com\/news\/#\/schema\/person\/8ef0fafb6c93f1204150bb907b42cfec"},"breadcrumb":{"@id":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/#primaryimage","url":"https:\/\/currencylive.com\/news\/wp-content\/uploads\/2019\/08\/100402-gbp-usd-us-fed-rate-decision.jpg","contentUrl":"https:\/\/currencylive.com\/news\/wp-content\/uploads\/2019\/08\/100402-gbp-usd-us-fed-rate-decision.jpg","width":725,"height":400,"caption":"GBP\/USD: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision"},{"@type":"BreadcrumbList","@id":"https:\/\/currencylive.com\/news\/100402-gbp-usd-us-fed-rate-decision\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/currencylive.com\/news\/"},{"@type":"ListItem","position":2,"name":"GBP\/USD: Pound vs Dollar At $1.40 Ahead Of Fed Rate Decision"}]},{"@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\/100402-gbp-usd-us-fed-rate-decision.jpg","amp_enabled":true,"_links":{"self":[{"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/posts\/4428","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=4428"}],"version-history":[{"count":0,"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/posts\/4428\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/media\/4429"}],"wp:attachment":[{"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/media?parent=4428"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/categories?post=4428"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/currencylive.com\/news\/wp-json\/wp\/v2\/tags?post=4428"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}