US dollar to pound rate: Dollar rises amid Trump and North Korea nuclear war worries | City & Business | Finance

Sterling was sitting at 1.287 against the American currency, while the euro was at 1.17 during Friday trading, as relations between Kim Jong-un’s rogue state and the US president continued to deteriorate.

Markets also awaited US inflation figures, as measured by the Consumer Price Index (CPI), which is set to signal how fast US interest rates will rise.

Data has showed the US economy appears to be slowing, which could mean its central bank the US Federal Reserve may not hike rates as fast in 2017.

Lower inflation also downgrades the possibility of further interest rate increases this year.

Lukman Otunuga, research analyst at FXTM, said: “Today’s main focus and event risk for the US dollar, will be the pending inflation report from the United States Federal Reserve, which should offer fresh clues on the pace of monetary tightening.

“Although the Greenback has maintained its post NFP gains this week, the overall price action suggests that market players are still hesitant to purchase the currency.

“Investors need more convincing over the possibility of higher US interest rates this year and this should come in the form of rising inflation.

“With concerns over stubbornly low inflation weighing heavily on the prospect of another US interest rate increase, the pending US CPI data will be in sharp focus.

“A soft inflation figure below market consensus, is likely to quell expectations of higher US interest rates, ultimately pressuring the dollar.”

If the US dollar weakens, demand for gold and other safe havens could continue to rise.

Gold prices have increased sharply as investors are spooked by nuclear war threats from Kim Jong-un.

At the same time the FTSE 100 and Dow Jones along with stock markets across the world have fallen as tensions rise between North Korea and the US president.

Mr Otunuga addded: “Market jitters from the escalating geopolitical tensions between the US and North Korea have brought Gold back into fashion this week, with the yellow metal hitting a fresh two-month high above $1288, during early hours on Friday.

“In times of uncertainty, investors continue to be attracted to Gold and further upside is likely, if US/North Korean anxiety supports the flight to safety.

“Although the metal is currently following a positive trajectory on the daily charts, market players might decide to remain on the sidelines ahead of the US inflation report, released later today.

“It should be kept in mind that the inflation figures have the ability to impact the…

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