{"id":4831,"date":"2018-08-29T00:00:00","date_gmt":"2018-08-29T04:00:00","guid":{"rendered":"https:\/\/currencylive.com\/100620-gbp-usd-confidence-boost-dollar\/"},"modified":"2018-08-29T00:00:00","modified_gmt":"2018-08-29T04:00:00","slug":"100620-gbp-usd-confidence-boost-dollar","status":"publish","type":"post","link":"https:\/\/currencylive.com\/news\/100620-gbp-usd-confidence-boost-dollar\/","title":{"rendered":"GBP\/USD: US Consumer Confidence at a high, boosting pound v\/s dollar"},"content":{"rendered":"<p>The GBP\/USD exchange rate peaked in Tuesday\u2019s trade at 1.2934, the highest seen since Wednesday of last week. However, strong US consumer confidence data, and investor concerns about Brexit meant that the gains in sterling were later reversed.<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th><small> What do these figures mean? <\/small><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><small> 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.For example, it could be written:<em>1 GBP = 1.28934 USD<\/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. Or, if you were looking at it the other way around:<em>1 USD = 0.77786 GBP<\/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. <\/small><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>The first half of August saw a strong positive trend for the dollar in general, but since August 15th, prices have been falling against most major currencies. However, yesterday\u2019s US Consumer Confidence Data showed a near 18 year high, which is expected to be interpreted as a positive for the US economy, suggesting steady growth is likely for the rest of 2018. US consumers are feeling good, which typically leads to increased spending and offers a boost to the economy. These signals are taken as positive signs by investors and can therefore lead to a rally in currency prices.<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th><small> Why does strong economic data boost a country\u2019s currency? <\/small><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><small> Solid economic indicators point to a strong economy. Strong economies have strong currencies because institutions look to invest in countries where growth prospects are high. These institutions require local currency to invest in the country, thus increasing demand and pushing up the money\u2019s worth. So, when a country or region has good economic news, the value of the currency tends to rise. <\/small><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>The impact of strong economic data was clearly seen in Tuesday\u2019s trading as the dollar rallied, against sterling in particular. The rebound in dollar pricing was not so strong against other major currencies, with Brexit worries also acting to suppress the pound\u2019s value.<\/p>\n<p>Investors in the UK will be following Brexit announcements and industry reaction carefully. Since the UK government released details of their plans for the event of a no-deal Brexit, industry analysts and thought leaders have been digesting this possibility. The UK government retain an upbeat tone, saying that a deal is the most likely outcome &#8211; and plans are in place should the UK crash out of Europe with no agreement. However, this level of political and economic uncertainty is limiting investor confidence, with a watch and wait attitude prevailing.<\/p>\n<table class=\"table table-bordered\">\n<thead>\n<tr>\n<th><small> Why is a smooth Brexit good for the pound? <\/small><\/th>\n<\/tr>\n<\/thead>\n<tbody>\n<tr>\n<td><small> A smoother Brexit would be a scenario in which the economic consequences of leaving the European Union are minimised. This is favourable for the pound because the less the Brexit impact on the economy, the more likely that foreign investors will remain interested in the UK. Foreign investors need sterling to invest in the country and so the more GBP is purchased, the higher the demand and, thus, an increase in the currency\u2019s value. <\/small><\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>Looking ahead, US investors are awaiting the Quarter 2, 2018 US GDP figures, which are expected to show growth in the region of 4%. Analysts expect there to be little upside if figures outstrip expectations &#8211; but there could be an adverse market reaction if the data shows slower growth than is expected. This could exacerbate the challenges the dollar is currently facing. In addition to upcoming economic data, markets are watching for further news on trade negotiations, both within North America as NAFTA is renegotiated, and also amid ongoing talk of a potential trade war.<\/p>\n<hr \/>\n<p><small><\/p>\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>The GBP\/USD exchange rate peaked in Tuesday\u2019s trade at 1.2934, the highest seen since Wednesday of last week. However, strong US consumer confidence data, and investor concerns about Brexit meant that the gains in sterling were later reversed. What do these figures mean? When measuring the value of a pair of currencies, one set equals [&hellip;]<\/p>\n","protected":false},"author":163946597,"featured_media":4832,"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-4831","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: US Consumer Confidence at a high, boosting pound v\/s 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\/100620-gbp-usd-confidence-boost-dollar\/\" \/>\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\\\/100620-gbp-usd-confidence-boost-dollar\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100620-gbp-usd-confidence-boost-dollar\\\/\"},\"author\":{\"name\":\"Fiona Cincotta\",\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/#\\\/schema\\\/person\\\/8ef0fafb6c93f1204150bb907b42cfec\"},\"headline\":\"GBP\\\/USD: US Consumer Confidence at a high, boosting pound v\\\/s dollar\",\"datePublished\":\"2018-08-29T04:00:00+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100620-gbp-usd-confidence-boost-dollar\\\/\"},\"wordCount\":808,\"image\":{\"@id\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100620-gbp-usd-confidence-boost-dollar\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/currencylive.com\\\/news\\\/wp-content\\\/uploads\\\/2019\\\/08\\\/100620-gbp-usd-confidence-boost-dollar.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\\\/100620-gbp-usd-confidence-boost-dollar\\\/\",\"url\":\"https:\\\/\\\/currencylive.com\\\/news\\\/100620-gbp-usd-confidence-boost-dollar\\\/\",\"name\":\"GBP\\\/USD: US Consumer Confidence at a high, boosting pound v\\\/s dollar - 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