GBP/USD close to an 18 month high

Despite yesterday’s slight blip the pound is now trading at close to the highest levels against the USD since July 2016 having experienced an upturn of over 2% for the pound since just before the Christmas break, the question for many is will this trend continue?

With news of further unrest in the Trump administration following news of the imminent release of an explosive book from Donald Trump’s former close aide Steve Bannon, then I would expect the potential for further US dollar weakness in the coming days. Rumours are circulating that lawyers for the US President are seeking to stop the release of the book, which apparently contains explosive insights into his presidency.

News such as this may not sit well for dollar investors and could see a number of dollar positions unwound. Combined with this we have seen some relatively poor jobs data of late, starting with today’s worse than forecast initial jobless claims figures. These are the precursor to tomorrows key jobs figures in the form of non-farm payroll data released at 13:30.

Tomorrows figures are expected to decline from the previous month and should they disappoint then expect some further US dollar weakness tomorrow afternoon.

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