GBP/USD slumps on QE speculation
Currencies Direct May 13th 2013 - < 1 minute read
The US dollar surged to two-week highs against the pound on
Friday (May 10th) as improving economic indicators raised
hopes the Federal Reserve could soon pull back on its quantitative
easing (QE) programme.
GBP/USD fell over 0.60 per cent to 1.5356 as it nudged away from
Wednesday’s high of 1.5592 and towards the April 23rd low of
1.5197.
In the US, the Department of Labor reported initial jobless
claims fell by 4,000 to a five-year low of 323,000 last week,
defying expectations for an increase of 8,000.
The news sent the dollar’s
exchange rate with a basket of major currencies higher as
speculation grows of a sooner-than-expected pullback on QE.
An improving labour market is a key requirement for the Fed to
wind down its $85 billion-a-month stimulus package, which weakens
the greenback.
EUR/USD fell by nearly 0.20 per cent on Monday in Asian trading
to 1.2969, while USD/JPY gained 0.30 per cent to 101.94.
The greenback finally broke through the 100 mark against the yen
last week after several failed attempts on the summit in the last
month.
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Currencies Direct