The US dollar traded in a wide range yesterday, initially stumbling amid Omicron fears, before rallying sharply after Federal Reserve Chair Jerome Powell’s tapering comments.
Find out more about the USD/GBP exchange rate
When sending money from the US to the UK, the USD/GBP exchange rate converts your dollars into pounds. Getting the best rate and timing your transfer to coincide with market strength helps you get more for your money.
Key facts about the USD/GBP exchange rate
The USD/GBP exchange rate was the third most commonly-traded currency pairing on the markets in 2016, accounting for nearly 10% of all currency market activity.
- USD/GBP has largely strengthened in the wake of the global economic financial crisis, with the United States’ ability to bounce back from economic turbulence helping keep USD appealing.
- The highest USD/GBP exchange rate of the last ten years was only struck at the beginning of 2017, when hopes that new President Donald Trump’s economic promises would boost growth pushed the US dollar up to £0.8317.
- The USD/GBP exchange rate was at its lowest levels before the financial crisis, with the pairing hitting a worst rate of £0.4738 on the 8th November 2007.
Currency information for the US dollar and pound Sterling
The US dollar is often referred to as the ‘Greenback’ or the ‘Buck’, while the pound is also known as Sterling.
Pound Sterling notes are currently available in a mixture of plastic and paper variations. Notes come in denominations of £50, £20, £10 and £5, while coins are available in denominations of £2, £1, 50 pence, 20 pence, 10 pence, 5 pence, 2 pence and 1 penny. In 2017 the Bank of England (BoE) introduced a new 12-sided pound.
Key factors that cause USD/GBP exchange rate volatility
The US dollar and the pound are both stable currencies, but the dollar has the edge against Sterling in times of market uncertainty. The UK’s vote for Brexit has been weighing on the pound since 2016, while the US dollar has been supported by the Federal Reserve’s decision to gradually normalise monetary policy.
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The US dollar attempted a recovery from Friday’s slump on Monday as fears eased over the Omicron coronavirus variant. However, concerns have returned this morning and the US dollar has fallen back in line with lower US Treasury yields.
The US dollar was placed on the defensive on Friday due to doubts whether the Federal Reserve will be willing to hike interest rates amidst worries over a new Covid variant of concern.