Monthly Archives: July 2016
Tonight we have a fairly important night for all banks in Europe as the latest banking stress tests are released.
What I find a little concerning is that the results of these stress tests are not being released until outside of trading hours at 9pm, this may be because this is when they are ready or more like that we may hear some fairly interesting news from them.
It is very rare that an economic data release from Europe comes out late on a Friday night and I feel that the reason they are doing this may be that they have some bad news to bring to the market and they do not want investors and speculators to react on it straight away.
By releasing data late at night on a Friday this gives ample time for statements to be released afterwards to settle the markets and two days for investors and speculators to calm down before the market sees large knee jerk reactions.
It is fairly common knowledge that banks in a number of areas are in quite a lot of trouble, most notably the Italian banks at present. Should the stress tests back this theory up then the Euro may find trouble and be down on Monday morning.
If you are in the position where you have a large Euro transaction to carry out then it may be prudent to keep an eye on the rates when the Asian markets open on Sunday night.
To be honest, these results may impact global attitude to risk so all major currencies may see volatility so it is key that you are on the ball and ready to react as your currency exchange may become thousands of Pounds cheaper or more expensive very quickly.
Here at Pound Sterling Forecast we do not only write up to date and important market information for you but we all work for one of the largest currency brokerages in the U.K so can also help you with your currency transfer. If you have a transaction to carry out involving buying or selling the Pound then feel free to get in touch with me (Daniel Wright) the owner and creator of this site and I will be more than happy to contact you personally to discuss your requirements. You can email me directly on email@example.com and I look forward to speaking with you.
The Pound took a sudden and severe hit which continued as the morning wore on, as UK companies were already showing concerning results since the announcement of the Brexit.
Profit warnings came out from the likes of Shell, Rolls-Royce, BAT and the UK stock market took quite a serious hit as a result. With the UK’s dependence on its financial services this correlated into lower confidence in the Pound, seeing a sharp sting for anyone considering buying a foreign currency.
Even with higher profits for Lloyds the lowered confidence in the UK was apparent with their announcement today that they would be cutting a 3000 more jobs and 200 more branches on top of their previous commitment to cut 9000 jobs and another 200 branch closures.
Whilst some companies performed well, the overall tone was negative, as the first look at concrete performance figures since the announcement of the Brexit shows the UK economy is struggling. A survey was released last Friday showing business confidence down to similar levels seen during the financial crisis. But concrete figures such as what was seen today are inscrutable and is why we saw a more sustained fall on the likes of buying Euro and Dollar rates than last week.
Euro buyers however, may see a turnaround in the short-term before the more voluminous data sets from last month are released during the first few weeks of August.
Late on Friday the Eurozone will be releasing the results of their stress tests on European Banks. Normally this is not a big market mover but some of our regular readers will note the particular attention paid to Italian Banks since the beginning of the month.
They have alluded to their rapidly deteriorating debt crisis, with now 1 in 6 loans deemed ‘junk’. These stress tests, like the concrete figures for the UK economy today, will likely put an exact figure in front of markets to understand the sheer scale of the current problem.
With the spotlight back on the Euro we may see rates reach more attractive levels late on Friday and by early Monday. There is a reason why the news is being released so late – to mitigate market reaction.
I strongly recommend that anyone with a Euro or Dollar currency requirement, whether in the short or long-term should contact me overnight on firstname.lastname@example.org to discuss a strategy for you transfer in order to maximise your currency return.
In this current market there are many potential variables and ‘forks in the road’ to be wary of, and there are a number of options in using a currency exchange specialist to minimise the exposure of your transfer to these potentially violent currency movements.
I have never had an issue beating the rates of exchange offered elsewhere, and these current buying levels can be fixed in place for anyone buying a foreign currency in the future, and are worried where rates may journey to in the meantime. 01494 787 478
Sterling exchange rates continue to hang in the balance, ahead of this morning’s UK Gross Domestic Product (GDP) figures. With an improvement on the previous figure expected, we could see Sterling start to put pressure back on 1.20 against the EUR and 1.32 against the USD. However, there is also an argument to make that the improvement has now been factored into the current market and we are only likely to see an aggressive move if the official reading comes outside of the 0.5% growth expected.
It’s a strange time for those clients holding Sterling, with the initial fallout from the Brexit now digested by the markets. Whilst the Pound has gained some traction following some political stability in the UK and the Bank of England’s (BoE) decision not to cut interest rates this month but there is still a feeling that we see further slippage at any time. The Pound remains extremely fragile and I do not expect any sustained improvement, or increased investor confidence under current market conditions. It is far more likely that the Pound’s value will be boosted by other factors, most prominently any downturn in other economies, such as the Eurozone. If investor confidence wains over the coming months, which is highly likely due further economic problems on the horizon for Greece & Italy, the EUR will start to lose value. This in turn will benefit the Pound but I do not see any major advances against either the EUR or USD in the short-term.
It may be prudent for those clients holding GBP to protect themselves ahead of the BoE’s next interest rate decision on August 4th. With a rate cut highly likely in my opinion and a possible increase in monetary policy (QE), the recent gains seen for Sterling could be short-lived.
If you have an upcoming GBP currency requirement and 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 email@example.com
Following on from a fairly turbulent few weeks Sterling has found itself reasonably stable against most major currencies over the last week or so but will that trend continue?
The key issue is what happens next with the Bank of England and whether or not we do see an interest rate cut at the next Bank of England interest rate decision a week on Thursday.
It does look more likely now that we will be seeing a cut which may lead to a further drop in the value of Sterling. An interest rate cut is generally seen as bad for a currency as it makes it less attractive to investors. We have indeed seen only this morning that a few banks have confirmed that they will potentially start to charge their business clients to hold money should the Bank of England end up entering into the realms of negative interest rates.
On top of this, as we enter August we will start to see the release of economic data for July (the first full month since we voted out) which will start to really show the initial signs of what the referendum vote meant for the economy.
A lot of businesses and the general public held back following the result of this vote so it would not be a great surprise to see economic data next month to be fairly poor and Sterling to feel the brunt of that so the next few weeks are a time to approach with caution.
There are plenty of other issues to be aware of around the world inclusive of the Italian Banks, the U.S election and the horrendous acts of terror that keep on happening, so be aware that at any time the markets can move rapidly and in any direction.
On Friday evening we also have banking stress tests released on Friday night at 9pm which is one to really look out for. The fact that this data is being released outside of trading hours suggests to me that we may well have quite a lot of problems that have been discovered and that they do not want the market to over react upon the release, therefore they are giving the market the weekend to calm down before trading. All European banks are being tested so be aware that this may lead to big market swings when the Asian markets open on Sunday night.
Should you have a currency exchange coming up in the near future and you want to make the most of your money then feel free to get in touch with me at any time today or this week to discuss the options available to you, including a forward contract where you can lock in a rate for anything up to a year in advance for just a small deposit.
Should you be in the process of buying a property, sending money overseas for your business or exchanging currency for any other reason then it is well worth getting in contact with me (Daniel Wright) the creator of this site directly. You can email me on firstname.lastname@example.org with a brief description of your requirements and a contact number and I will be more than happy to deal with you personally.