The latter half of September has been characterised by significant US dollar demand, with USD exchange rates being propelled to new multi-month highs.

During this time, we’ve seen GBP/EUR trade between €1.16 and €1.14, while EUR/GBP has climbed to £0.86.

Meanwhile, GBP/USD plunged from $1.23 to a six-month low of $1.21, while EUR/USD retreated from $1.06 to as low $1.04.

Latest currency news

Staying on top of the latest currency news can help you time your transfers more effectively, so find out what you should be looking out for over the next couple of weeks…

What’s been happening?

The US dollar roared higher over the past couple of weeks. The sharp appreciation of USD was driven by safe-haven flows as well as expectations of another interest rate hike from the Federal Reserve, following its hawkish pause at its September meeting.

In contrast, the pound plummeted to multi-month lows as the UK’s economic outlook grew increasingly gloomy and the Bank of England (BoE) surprised markets by keeping interest rates on hold.

Meanwhile, trade in the euro was choppy in the second half of September. The single currency’s negative correlation with the US dollar acted as a major headwind, while mixed data also infused volatility.

What do you need to look out for?

Looking ahead, the second half of August may see the pound remain on the back foot amid heightened concerns over the UK’s cost of living crisis and the current political vacuum. 

For USD investors the focus will likely be on the Fed’s Jackson Hole Symposium. Any stronger hints regarding the bank’s policy outlook could inspire movement in the US dollar.

Meanwhile, the movement in the euro is likely to remain tied to concerns over European energy security. While the single currency also likely to be pressured if the Eurozone’s latest PMI figures point to another contraction in the bloc’s private sector.

Free Currency Transfers

At Currencies Direct we’re here to talk currency whenever you need us, so get in touch if you want to know more about the latest news or how it could impact your currency transfers. Since 1996 we’ve helped more than 430,000 customers with their currency transfers, just pop into your local Currencies Direct branch or give us a call to find out more.