Interest rate decision for the UK fast approaching. This could be one of the most volatile days for the pound against the Euro and USD. (Ben Amrany)
Yesterday was a fairly positive day for the pound as it stabilised slightly over the last couple of days after the volatile times that we have witnessed over the last few weeks. In fact yesterday the pound was one of the best performing currencies out of all the majors and we saw some good gains against the USD and Euro. Although we had a good day the levels are still extremely weak for clients looking at selling the poound. If you are looking at purchasing the pound then you are currently trading at a two and a half year high for US Dollar sellers and a 15 month high for Euro sellers. While if you are one of the southern hemisphere currencies you are bordering at all time highs for selling Australian & New Zealand Dollars against the pound.
This morning the Governor of the Bank of England is speaking and I am sure you are all aware that they have made comments over the last few weeks that a weak pound is good for the UK economy so it will be interesting to see if his comments continue to weaken the once great British Pound.
Tomorrow will be the big day for the UK though. With the interest rate decision for March fast approaching we beleive that the bank of England may look at further monetary stimulus in the form of QE. If this were to occur then the losses could well continue tomorrow against a host of majors. Recently one memeber of the BoE even stated that we could have negative interest rates. If ever there are signs that the bank would like to weaken the pound those comments should frighten you. If you need to sell the pound you may be wise to look at your position before this key data release tomorrow morning. If you are buying then why not place a limit order in the market so you can try and achieve a better rate than what is currently available.
In the Euro zone there will also be an interest rate decision. If the ECB decide to cut rates (although unlikely) then this could counter act the potential QE in the UK. If the UK do QE and the Eurozone do not cut rates then I would exect the pound to weaken. If there is no QE in the UK and the eurozone cut rates then I would expect to see some sterling strength. So overall tomorrow could be very volatile. I do however feel the Euro will continue to gain as confidence is slowly moving back into the single currency.
If you have a requirement to buy or sell any major currency then please do conatct me with your currency requirement at email@example.com or call the trading floor and ask for Ben Amrany. I will strive to make sure that you receive a better rate than your bank or current provider plus we will make sure that you receive a very personal service to try and help you maximise your conversion by giving you the information to decide when may be a good time to do your currency conversion.
Thank you for reading.