gbp / usd Live Exchange Rate

When looking at the GBP/USD it is necessary to bear in mind that the pair fluctuates chiefly on the strength of the economy in each country. This is different from other currency pairs which are influenced by other factors. If the UK economy is doing better than the US, then the pound will strengthen against the dollar. Equally, if the US economy is doing better, then the dollar will strengthen. However, it is important to note that the GBP/USD price can also be affected by the interest rates set in the UK by the Bank of England, and in the US by the Federal Reserve.

The currency pair used to be traded across the Atlantic by cable, hence the nickname “the cable”. In general, the GBP/USD pair has low spreads, but with few opportunities for arbitrage. There is a great deal of news about both countries on a continuing basis, which makes the pair suitable for those who trade the news, or enjoy fundamental analysis as opposed to simply technical trading.

GBP / USD Additional Info

GBP

The UK is not geographically the largest country in Europe, but it has certain unique characteristics, not the least of which is that, while a member of the European Union, it does not use the euro as its currency.

The pound sterling is the third most important reserve currency in the world, and the fourth most traded one after the US dollar, the euro and the Japanese yen. The pound and euro very often differ in value from one another, but their movements can be similar in relation to the US dollar.

The decision by the British government in 1999 to keep the pound sterling and not join the euro has created major investment opportunities for forex traders over the ensuing years.

USD

This has for many years been accepted as having a special place in the currency markets. It is the traditional safe haven in times of trouble, and is the currency used more than any other for international transactions. When there are times of political or global financial troubles, the first place that most investors look is the US dollar. In fact, the US dollar is traded more than any other currency in the world.

The US is the world’s biggest economy – larger than the European Union or China - and has a GDP of $14 trillion. That is a lot of dollars.

GBP / USD News & Analysis

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