Monthly Archives: June 2010
GBPEUR exchange rates hit 20 month high
The pound has hit a twenty month high v’s the Euro today following renewed concerns over the health of European Banks. The ECB had funding in place to help banks with liquidity and those plans have come to an end. The Spanish government and banks are unhappy that the funding is no longer in place and this has concerned financial markets.
EU banks have to repay some short terms loans on Wednesday, which is also adding to uncertainty in the markets. The risk of contagion remains high, as it is feared that if we do see any default from a European bank it could affect US and UK banks.
Sterling and the week ahead
Sterling exchange rates could be in for a volatile week with a host of data from Mortgage approvals to consumer confidence for the UK. Most importantly though could be the GDP figures which are out on Wednesday morning at 9.30. The GDP figures have made headline news over the last couple of years as it highlights how the UK economy is either growing or shrinking. GDP at present is hovering at 0.2% which is just above the recession level. If the UK economy does not show signs of growth then then their is always the possibility that the pound could weaken against a host of currencies so these figures out could be crucial if you have an up and coming currency transfer to make.
In the US last Friday they released their GDP figures and it showed that their economy was still growing but at a much smaller pace than was anticipated. As a result the US Dollar weakened and if the same happens for the UK then we could see sterling weakness across the board. However if the economy continues to grow and at a faster pace than anticipated then the pound could gain.
Data that may affect the pound this week.
Today German consumer price index
Tuesday 29th UK Mortgage approvals
Tuesday 29th European consumer confidence
Wednesday 30th UK consumer confidence
Wednesday 30th UK GDP
Wednesday 30th Canadian GDP
Thursday 1st UK & European PMI
Friday 2nd US Nonfarm Payroll.
If you are buying a property abroad, have business transactions to carry out or need to get money overseas for any other reason and want the best exchange rates, just fill in the form on the right hand side and one of the experienced traders that write on this blog will be in touch shortly.
GBP-USD at a 6 week high. How long will the pound continue to strengthen?
Sterling exchange rates has hit a 6 week high during the American trading session against the US Dollar partly down to the FED keeping its interest rate on hold as widely expected. They also seemed to lower their assessment of the US economy which contributed in the USD weakening against a host of major currencies.
In other news credit rating agency Moody’s came out with comments that the UK will keep its triple A rating if it can successfully implement reducing the UK’s budget deficit outlined in Tuesday’s budget. Now that Moody’s have come out with these comments we would expect investors to have more confidence in the UK and hopefully helping sterling exchange rates to strengthen over the course of this year.
By how much and how long the rise in the pound takes is any ones guess. If the markets over the coming months show that the government’s austerity measures will hamper economic growth in the longer term then we may not see sterling exchange rates strengthen as much as we would like and it could push the pound back down to the the early 1.40′s otherwise we may see a resistance level around 1.50.
If you are buying a property abroad, have business transactions to carry out or need to get money overseas for any other reason and want the best exchange rates, just fill in the form on the right hand side and one of the experienced traders that write on this blog will be in touch shortly.
Sterling gains following MPC member Sentence surprisingly voting for rate hike
The Pound has made gains in early morning trading following the shock that MPC member Andrew Sentence had voted in favour of an interest rate hike at the last interest rate decision.
For those who aren’t aware an interest rate hike is generally seen as positive for the currency concerned and a cut negative, with the markets moving on rumour as well as fact this news increases the chance of an earlier hike and therefore has lifted confidence in the Pound.
If you are buying a property abroad, have business transactions to carry out or need to get money overseas for any other reason and want the best exchange rates, just fill in the form on the right hand side and one of the experienced traders that write on this blog will be in touch shortly.
Sterling spike following UK budget
The pound has rallied following the coalition Government’s emergency budget. The chancellor appears to have struck the perfect balance between appeasing financial markets with pans to reduce the budget deficit and national debt, and reducing the impact of austerity measures on economic growth.
As there was some uncertainty in the market surrounding the budget, the pound has strengthened as the chancellor has significantly reduced the ‘unknown’ with a strong budget. Here at PSF, we like to remain politically unbiased, as such I don’t like to sound like I’m championing either side of the house of common, but this budget really has hit the nail on the head! For anyone looking to buy foreign currency, you couldn’t have asked for a more positive reaction.
On the other side of things, anyone holding foreign currency and looking to buy sterling it may be worth considering your options now, as it looks unlikely that the exchange rates will move any further in your favour in the short to medium term. Remember, despite the recent gains in sterling the pound is still 29% cheaper v’s the USD and 11% cheaper v’s the EUR compared to exchange rate in 2007. This means that historically, exchange rates are very good at the moment.
Looking further ahead, there could be a test for the pound in 2011, as the VAT rise comes in and unemployment may start to rise as a result of spending cuts. I think the hope is that by the start of next year the economy will be in better shape to handle such challenges.
Important day ahead for the Pound Sterling – Will the budget be taken well?
Today we see an extremely important day for the Pound against all major currencies and although we may not see any instant movement it will show a good indication as to what may happen going forward throughout 2010.
The budget is due to be out at 12:30pm and the new coalition Government will have to get the balance between aggressive cuts in order to combat the deficit and not going too over the top and pushing the U.K back into recession just right.
My personal opinion is that they will get this right and it will take time but the Pound will gain ground over the course of the summer once the dust has settled from the original release.
Have you budgeted for the budget? What will happen to the Pound?
I hope you all had a great weekend?
For those of you with upcoming transfers to make be it buying or selling foreign currency with the Pound this week is seriously important for you – especially with tomorrow’s emergency budget looming.
This could have an instant impact on the value of the Pound against all major currencies and should already have an agreement in place to purchase a property overseas it could make it a lot more expensive.
To be honest it is hard to call exactly what kind of effect the budget will have on the markets until it is fully released but do be prepared for some volatility, if you want me to keep you up to date with what is going on then fill in the contact form on the right hand side of this page as I have one eye on the market throughout the day and can jump on the phone should there be any rapid movements for or against you.
What will happen to Sterling after the budget?
The Pound has remained reasonably stable leading up to the budget due to come out on the 22nd of this month.
Many clients calling in are now asking me just what I think will happen after the budget….. The truth is I don’t know until it is released however the general feeling is that the Pound may take a minor dip immediately after the release due to cuts being extremely harsh, however in the longer term we should see the Pound start to slowly gain strength as this can eventually only be seen as positive with a plan finally in action.
This morning sees the release of mortgage approvals data, money supply and public sector net borrowing all out at 09:30am and this may set the scene for the day ahead… personally I can’t see any huge swings on the market today but then and again there are always surprises popping up in the current climate.
If you are buying a property abroad, have business transactions to carry out or need to get money overseas for any other reason and want the best exchange rates, just fill in the form on the right hand side and one of the experienced traders that write on this blog will be in touch shortly.
Pound Forecast V’s Euro and Dollar
We are currently trading close to an 18 month high for the pound against the Euro, so if you are considering buying the single currency in the next few months, now may be a good time to secure funds on spot, or lock into a forward contract.
It is also worth bearing in mind that we have the first budget for the new coalition Government, with spending reductions and increased taxation expected. This could affect the pound depending on how the budget is received by the financial markets. If the markets feel that the new austerity measures go too far, and that this could have negative effect on the economy, Sterling exchange rates could fall. So if you do have any requirements, fill in the form on the left askinf for Aidan and I will be able to run through the options open to you.
On the US Dollar side of things, anyone looking to sell the Greenback may also want to get in touch; we are not far off a 13 month high at present.
Pound-Euro exchange rates
Today could be a very volatile day for sterling exchange rates and the Euro against a host of currencies with a big EU summit to try and tackle the debt issues of the Euro Zone and how they will get economic growth back on track.
The pound has taken a hit during the Asian session as a host of negative data came out for the pound yesterday. Unemployment figures were more disappointing than what was expected and consumer confidence in the UK was at an 11 month low.
The pound has seen some really good gains of late against the Euro and Aussie Dollar and USD. Against the Euro the pound has recently spiked to a 19 month high and against the USD we were recently trading a month high. The gains are starting to be reversed now and if you have a requirement to buy or sell any currency please feel free to contact us and we would be delighted to speak with you about the outlook for the currency that you require.
If you are buying a property abroad, have business transactions to carry out or need to get money overseas for any other reason and want the best exchange rates, just fill in the form on the right hand side and one of the experienced traders that write on this blog will be in touch shortly.
