In the last few months, the foreign exchange market experienced very large swings. Retracing some of those earlier gains, the GBP/USD exchange rate is now finding resistance just above the 1.3150 level. This all takes place in a very turbulent operating environment. As the China-U.S. trade war heats up and the possibility of recession looms in the United States, so does public anxiety.
USD traders are responding to the shake-ups that are putting the U.S. Dollar on shaky ground. This is primarily due to the United States’ continuing trade war with China, which serves as the main driver. Like any war, it doesn’t stop. It keeps getting worse. The trade war is already wreaking economic havoc. That uncertainty fed worries of an imminent recession in the U.S. economy, adding to the dollar’s vulnerability.
And, of course, all that recent data contributed to the overall negative sentiment swirling in the markets. U.S. Producer Price Index (PPI) for March came in below expectations, pointing to weaker inflationary pressures. This kind of data frequently moves the market forecasts on interest rates and monetary policy, which then flows through to currency valuation. And with inflation not looking like a sign of strong growth, investors seem to be growing more worried about the global economic picture.
The FX market is known for its complexity and volatility, requiring the right trading partners to help navigate the markets. To be traders in today’s fast-paced cryptocurrency market, they need the best tools and platforms to trade quickly as currency values change by milliseconds. FXStreet hereby disclaims any liability arising out of the use, reference to or reliance on such information and related statements. This article is in no way intended to provide investment advice. So, investors beware. 81.4% of retail investor accounts lose money when trading Contracts for Difference (CFDs) with this provider.
In a twist worthy of novelist Elmore Leonard, Wall Street rocketed up after then-President Trump announced his decision to delay the tariffs on Chinese imports. This piece of news gave a burst of hope to the market, pumping up optimism among investors and pushing stock prices up-er considerably. These kinds of developments usually have far-reaching implications in the global marketplace, creating ripple effects that may sway currency pairings such as GBP/USD.
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