Buying Euro and Dollar rates of exchange enjoyed a week where politics took a back seat for short while in governing the currency markets.
The Pound recovered against most of its counterparts gradually throughout the week following the flash crash, and by over four cents against the Euro as just one example.
With the major political announcement of a deadline for Article 50 by March having taken place, and with secretive pre-negotiations beginning behind closed doors, barring any surprises, it seems that normality has returned to the markets to some extent with the influence of politics on the value of the Pound falling away.
This weekends news that there is already bickering between the UK and Europe as to which language the negotiations would take place in, French or English? A clear indication to the currency markets that little news of any importance will reach their ears in the short term.
Pre-Brexit vote buying Euro and Dollar rates were mainly governed by news of economic performance released regularly throughout each month both within the UK and in the likes of Europe, the USA and Australia, with the value of each currency swinging based on the positive or negative nature of the news.
The data releases to watch out for next week:
On Monday we have business confidence figures for the powerhouse of the European economy, Germany, to begin the week. Given expectations for improvement here now that the German Government have agreed to bail out Deutche Bank if need be, the Euro should gain back some of the lost ground against the Pound over the past five business days.
Following this, an event which will effect all major pairing with Sterling – GBP/EUR, GBP/USD and GBP/AUD, will be the first look at growth figures for the UK economy in the first full quarter since the Brexit.
The importance of this news cannot be understated. Recessions are gauged on growth for two consecutive quarters being negative. If the UK’s growth in this period stagnates the Pound could face heavy losses akin to the flash crash a few weeks ago.
Current expectations are for growth to fall to 0.3% from 0.7%, but we will not know the truth until Thursday morning.
Given the recent gains, and with a week seemingly without much concrete information to suggest a rise in the value of the Pound, particularly against the Euro, foreign currency buyers may be wise to move sooner rather than later to avoid the risk laden in the marketplace next week.
You can reach me directly over the weekend whilst markets are closed on firstname.lastname@example.org to discuss the options open to you to safeguard your transfer from any potential pitfalls, as well as the make the most of what is available in this current marketplace.
I have never had an issue beating the rates of exchange on offer elsewhere, and these current buying levels can be fixed in place for anyone planning a foreign currency transfer later in the year and wish to avoid the risk of gambling on what levels are available then.
Sterling buyers using Euros or Dollars can also get in contact, and I will discuss the options open to you to ensure that any peaks you are aiming for can be secured should they become available in the timeframe you have to complete your transfer.
You can also reach me using the form below, and I will contact you as soon as I am able to.
Will Sterling Euro exchange rates fall further owing to the Brexit issue and Article 50? (Tom Holian)
Sterling Euro exchange rates have had an interesting week with the Pound struggling to make gains even though inflation has shown a rise. Since the Brexit vote back in June Sterling has suffered badly against all major currencies and we are now over 20 cents lower against the single currency and I think we could further losses for Sterling ahead.
Some analysts at Credit Suisse have predicted that we could see GBPEUR rates hit 1.05 soon and GBPUSD rates hit as low as 1.10. The reasons for the predictions are down to the higher possibility of a ‘hard’ rather than a ‘soft’ Brexit.
Since the news that Article 50 will be triggered in March next year Sterling has plummeted against both the Euro and the US Dollar and even positive UK economic data is doing little to lift Sterling’s value. Recently both Bank of England governor Mark Carney and Ben Broadbent have both spoken about the value of the Pound and don’t appear to be too concerned. They have both spoken out saying that the Pound’s value is not their highest priority so to me this signals that we could see an interest rate cut when the Bank of England next meet in November.
Typically when a central bank cuts interest rates this causes the Pound to weaken and I would not be surprised to see this happen next month. Carney also recently spoke out about the previous interest rate cut and claimed that it was a good idea in the wake of the shock caused by the Brexit and therefore again I think we could see further intervention by the Bank of England.
With interest rates at historic lows in the UK the Pound is not offering its previous attractive yields and this is another reason for the decline in the vale of Sterling against the Euro and the US Dollar.
If you’re in the process of buying a property in Europe before Article 50 is triggered in March it may be worth looking at buying a forward contract which allows you to fix an exchange rate for a future. In the last month I have noticed a huge interest in my people buying forward contracts to avoid the uncertainty for Sterling in the months ahead.
Having worked in the foreign exchange industry since 2003 I am confident of being able to offer you competitive rates of exchange when buying or selling Euros so if you have a currency transfer to make and want to save money on exchange rates compared to using your own bank or if you’d like further information then contact me directly and I look forward to hearing from you.
Tom Holian email@example.com
Alternatively fill in the form below
The Pound has found life extremely tough going of late, with losses against most of the major currencies. This has been particularly apparent against the EUR & USD, with the Pound losing value in line with the current uncertainty surrounding the UK economy.
However, despite these losses it is not all doom and gloom for those clients holding GBP, as Tuesday’s positive spike for the Pound proved. Currency does not move in a straight line and therefore we will see opportunities for those clients holding GBP to take advantage of, even if a sustainable Sterling recovery is unlikely in the short-term.
Sterling has had a better week and the catalyst for the was Tuesday’s inflation data, which came out above market expectation. Whilst this spike cooled, the Pound was holding its position against the EUR & USD following the latest UK employment data and official Unemployment rate. Whilst the official figure of 4.9% came in as expected, average earnings were up and this should help to support Sterling’s position as we head into next week’s trading.
Thursday’s European Central Bank interest rate decision was something of a non-event but President Mario Draghi did elude to the fact that the central bank would extend the current monetary policy (QE) programme if necessary, news which is likely to help support the Pound around its current levels.
My overall feeling at the moment is that the Pound is suffering due to the unique situation the UK finds itself in and the uncertainty that corresponds with this. We will no doubt find out more information about how we will facilitate our Brexit and the trade deals that may be acquired and as each facet of this uncertainty is removed, the Pound is far more likely to gain enough support to drive its value up.
If you have an upcoming Sterling currency requirement the current levels are a stark reminder as to how important it is to be kept up to speed with key market movements, ahead of any prospective currency exchange. The currency markets can move aggressively and without prior warning and this is where a proactive broker can help you time your trades and maximise your currency transfers.
If you would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478 and ask one of the team for Matt. Alternatively, I can be emailed directly on firstname.lastname@example.org
I recently outlined forecasts for the GBP/EUR pair of 1.0922 – 1.1000 from Credit Suisse, and unfortunately now for those hoping for a Sterling recovery, the same bank has lowered their forecast to 1.0526, and this is based on a 3 month period.
The bank has also offered a price target for the GBP/USD pair of 1.1700, so I guess the bottom line is that they’re currently expecting further Sterling downside.
Despite these prominent predication the Pound has actually held it’s ground over the past couple of days after falling on almost a daily basis for almost 2 weeks after Theresa May publicly confirmed suspicions that the invocation of Article 50 will go ahead in March of next year.
The Pound fell because many had hopes for a ‘Soft Brexit’, but those hopes have now all but faded after May’s decision to begin the UK’s separation of the EU earlier than many had hoped.
The reason for the Pound staging a fightback has been some better than expected inflation figures from the UK which came out earlier this week. The figure came out much better than expected at 1% which puts the UK on track to reach it’s 2% target, but I do think inflation could get out of hand if the Pound continues to fall at such a fast rate.
Those planning a currency conversion which involves exchanging the Pound for another currency may wish to consider making that conversion sooner as opposed to later, because if the forecast from Credit Suisse as well from an increasing number of banks are to become true, the Pound has a further 6% or so to fall which equates to large amounts of money on the larger currency conversions.
If you would like to discuss timings and exchange rates, feel free to contact me on email@example.com in order to ensure you make a well informed decision on when to make that particular transfer, as well as benefiting from highly competitive exchange rates from one of the UK’s leading foreign currency brokerages. Just provide me with a basic outline of your currency requirement and I will be back in touch with you as soon as possible. You can also get in touch by telephone on 01494 787 478, just ask reception for Joe.
It’s been an interesting couple of days for Sterling exchange rates as the currency has been undecided on its general direction of movement.
At the time of writing the Pound is actually down on the day against all major currency pairs such as the US Dollar, Euro and the Australian Dollar. Although throughout today’s trading session Sterling has spiked upward at times, offering clients the chance to book their trades whilst the exchange rate was quite considerably higher than it’s lowest point throughout the day.
The reason for the buoyancy towards the Pound this morning and at times throughout the day, is most likely down to the better than expected inflation figures yesterday which demonstrated a 1% gain in inflation over the past year, which is currently a healthy level although that could change if it gets out of hand due to the rapidly weakening Pound.
It’s on days like today whereby our clients benefit from the service we provide, as the monetary difference between converting currency at the bottom of the day’s exchange rate range, compared with the top of the day’s range can be huge when converting large amounts of currency.
We’re already in a position to improve substantially on the exchange rates offered by high street banks, but with our proactive service we’re able to often maximize our clients exchanges to their benefit.
There are a number of analysts from major institutions offering forecasts for the GBP/EUR pair of parity, which means they’re expecting the Pound to fall another 9% or so between now and in many cases, the end of next year. HSBC are perhaps the most prominent entity to make such a claim, so feel free to get in touch if you wish to discuss your options regarding this potential fall as there are methods of protecting yourself against such a fall.
Tomorrow is expected to be a busy day for exchange rates due to the raft of economic data releases, with the European Central Bank’s Interest Rate Decision likely to be the most prominent. Should there be a change to the 0% figure expected tomorrow by analysts, I would expect to see some substantial movement within exchange rates involving the Euro as well as many other pairs who’s performance is interconnected with the ECB’s monetary policy.
The ECB’s release is at 12.45pm which gives you plenty of time to get in touch beforehand should you wish. You can call me (Joseph) directly on 01494 787 478 if you wish to regarding the news release and our service.
If you are planning to make a currency exchange involving the Pound, it’s worth your time getting in contact with me on firstname.lastname@example.org in order to ensure you make a well informed decision on when to make that particular transfer, as well as benefiting from highly competitive exchange rates from one of the UK’s leading foreign currency brokerages. Just provide me with a basic outline of your currency requirement and I will be back in touch with you as soon as possible.
Short lived Sterling recovery vs Euro and US Dollar owing to rising UK inflation levels (Tom Holian)
Sterling has seen one of its biggest gains against both the Euro and the US Dollar yesterday as UK inflation came out higher than expected. Inflation rose 1% in September up from 0.6% in August according to the Office for National Statistics.
Clothing rose as well as fuel and it could be suggested that the price of the weak Pound could have been a key factor especially when you consider how much GBPUSD exchange rates have dropped since the vote to leave the European Union.
The rise in inflation is the biggest monthly increase since June 2014 and if this trend carries on this could really have a longer term impact on the UK economy. Indeed, if inflation goes above 2% then this starts negatively affecting income in real terms and if the Pound vs Dollar rate remains this low or drops even further then this is likely to increase the cost of a basket of goods.
The Bank of England deputy governor has even said earlier this week that the central bank are not too concerned with Sterling’s fall and with the Bank of England due to meet next month I think we could even see an interest rate cut coming next month.
Therefore, I think yesterday’s recovery for the Pound vs the Euro and the US Dollar is likely to be relatively short lived as the Pound is being mainly driven by political influences caused by Article 50.
If you’re in the process of buying a property in Europe before the end of the year then you may wish to consider buying a forward contract which allows you to fix an exchange rate for a future date.
Having worked in the industry since 2003 I am confident not only of offering you better exchange rates than using your bank when buying or selling Euros but also help you with the timing of your transfer.
If you would like further information or for a free quote then contact me directly and I look forward to hearing from you.
Tom Holian email@example.com
Alternatively fill in the form below
If you are a regular reader you will know that Brexit talks will continue to put further pressure on sterling exchange rates for the remainder of the year. Now that UK Prime Minister Theresa May has announced she will be invoking Article50 in March we have to expect sterling weakness up until the event.
Yesterday Attorney General Jeremy Wright told the High Court once the process of leaving the EU begins there is no going back and Theresa May does not need the consent from MP’s within parliament. This is further bad news for the pound as it seems the triggering of Brexit will actually occur early next year.
A story I believe will make headline news in the upcoming months will be if the Scottish Government will hold a 2nd referendum in regards to remaining part of the United Kingdom. SNP leader Nicola Sturgeon has announced she wants the Scottish people to decide their own fate , in other words she wants Scotland to remain part of the EU and she’s happy to leave the UK to do this.
Short term the UK are set to release their latest inflation numbers this morning at 9:30. The consensus is for a slight rise which could cause the pound to spike against most of the major currencies. If you are buying a foreign currency in the short term, this is a spike you may wish to take advantage of. It takes two minutes to send me an email with your requirements and I can alert you to the buy price we can achieve presently. By doing this you can make a comparison to your own provider to make sure you are receiving the best price possible.
To answer my original question of ‘What to expect for the pound for the remainder of the year?’ I strongly believe the pound will come under pressure and there is a good chance sterling exchange rates will continue to fall. However it’s crucial you analyse both the currencies you will be trading, as there could be spikes in the market to take advantage of.
Feel free to email me the currency pair you are trading (GBPUSD, GBPAUD, GBPCHF etc) the reason for your trade (company invoice, buying a property) and I will email you with my forecast for the currency pair firstname.lastname@example.org.
Property purchases and sales are my area of expertise, therefore if you need to purchase a foreign currency or you are about to complete on a sale abroad, today is the day to get in touch to discuss your options and to get an understanding of how we can save you as much money as possible.
** If you are already using a brokerage and would like to know if you are receiving the best rates possible email me with the exact figures and I will reply with our live price. This will take you minutes and in the past I have saved clients thousands! **