A month later I enter an invoice for exactly the same number of $.
When I try to allocate payment I see a figure in £ at the top, and a figure in $ on the line.
When I click on "all" the £ figure appears beside the $ figure in the line, and results in about a 1% shortfall.

How can I allocate the $ balance to the $ invoice?

I have cancelled auto update of exchange rate, but exchange rate should not be involved any way.