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28/07 – Fed meeting due at 7pm

GBP: Sterling pops higher 

EUR: Not much of a footing

USD: Fed should allow for some dollar strength


Sterling ended yesterday sharply stronger without too much reason. There is very little liquidity in markets at the moment and so moves can be outsized and we would not be surprised if the slight improvement in Covid-19 case numbers underpins some of the run higher for the pound.

With a Bank of England meeting next week, it does look like the pound could continue higher should markets get behind the UK’s Covid-19 plans and view the improvement as sustainable.


As expected, yesterday was an incredibly quiet day for EURUSD and will likely be so again until the Fed decision at 7pm this evening. We expect the meeting to be slightly USD positive and with the single currency unable to find much of a footing at the moment, it would make sense for EURUSD to trade lower this evening.

The wider risk remains however that the Fed lean on the rise in delta variant cases in the US to advocate for a delay to any reduction in stimulus.


As noted above, the Federal Reserve meeting this evening has been slated as the most important factor for currency markets this week although it is a very quiet week.

News in China has actually been the driver of dollar markets with a crackdown by the Chinese government on certain companies has upset risk appetite and sent local shares lower. A decent earnings picture from the States has also not been picked up by investors suggesting optimists are either tired, on the beach or are not comfortable with the overall macro environment.

The Fed meeting is at 7pm tonight and may offer USD strength although are fears around the delta variant may postpone any hawkishness until August.


AUD has strengthened a little overnight following a slightly better inflation number than had been forecast. The recent news out of China will be enough to keep the AUD and NZD however amid the weakness in global risk.

Market rates

Today’s Interbank Rates at 08:14 against sterling. Movement vs yesterday.

US dollar$1.388 
Australian dollar$1.889 
South African randR20.56 
Japanese yen¥152.5 

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Jeremy Thomson-Cook

Jeremy Thomson-Cook

Jeremy has over 13 years experience working in the FX industry. As a specialist in political risk mitigation and currency hedging, he regularly advises clients on the day-to-day moves of the markets and the implications of fiscal and monetary policy on international businesses.