The GBP/USD currency pair today rallied higher after news emerged that Theresa May had struck a deal with the DUP to form a minority government. The British pound rallied higher against the US dollar after the release of disappointing US durable goods orders figures by the Census Bureau, which did not meet expectations.
The currency pair opened the day’s session n a positive note before a major decline occasioned by a sudden decline in gold prices, but had retraced most of its losses at the time of writing.
The news that Theresa May’s Conservative Party had struck a deal with the DUP from Northern Ireland boosted investors’ confidence in the pound, which caused the GBP/USD pair to hit a daily high of 1.2759. The pair retraced its gains shortly afterwards due to a drastic decline in global gold prices.
The US durable goods orders data did not meet expectations as it came in at -1.1% versus the expected -0.6%, which contributed to the greenback’s weakness. The Chicago Fed National Activity Index also came in below expectations as it declined by 0.26 as compared to the expected 0.20 decline. The US Dollar Index, which tracks the greenback’s performance, was also trading below its opening price at the time of writing.
The currency pair’s future performance is likely to be affected by Mark Carney‘s speech and the release of US consumer confidence data for June, both scheduled for tomorrow.
The GBP/USD currency pair was trading at 1.2742 as at 14:00 GMT having retraced most of its losses from a low of 1.2703. The GBP/JPY was trading at 142.06 having opened the day’s session trading at 141.76.
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