The pound was boosted yesterday following a report in Business Insider stating that the European Parliament may be prepared to grant the UK some form of single market access following Brexit.
USD shot higher last Monday as markets welcomed suggestions that the Fed may choose to speed up the pace of its monetary tightening in 2018.
This prompted a major sell-off on the stock markets, which in turn bolstered the US dollar as investors flocked to the safe haven currency amid fears of a possible crash.
Speculation intensified further following a number of speeches from Fed policymakers last week, many of whom appeared unfazed by the drop in stocks and appeared to support further rate hikes this year.
This led many investors to begin pricing in a March rate hike, with CME group’s FedWatch tool, currently placing the odds of a hike next month at over 75%.
Nevertheless, the US dollar may find itself beating a hasty retreat this week when the latest CPI figures are published.
Economists forecast that inflation will have slid from 2.1% to 1.9% in January, possibly weakening hopes of a Fed rate hike next month.
Joining the corporate trading desk in 2007, Phil now overseas all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure
Phil has FSA approval and has completed the Certificate in International Treasury Management (CertiTM)