Monthly Archives: August 2016

Will the Recent Sterling Recovery Continue? (Matthew Vassallo)

Sterling has found some much needed market support over recent days and the current trend continued during Wednesday trading, with GBP/EUR & GBP/USD rates improving.

The Pound spiked by over a cent against its EUR counterpart, following worse than expected Unemployment data from the Eurozone. The official figure of 10.1% immediately caused a EUR sell off, which inadvertently boosted Sterling’s value. With reports also surfacing this morning that UK Prime Minister Theresa May is chairing a Brexit brainstorming meeting at Chequers, we may find that developments surrounding our Brexit move forward quicker than many first thought. Whilst it is possible that article 50 will not be triggered for another two years or more, any solid indications of how we will facilitate it and the likely time-frame, should help to alleviate some of the current pressure on Sterling moving forward.

I still feel it is unlikely that the Pound will gain any major ground under current market conditions but we may now see GBP finding some sort of foothold after weeks of negative downturns. Personally I would be keen to protect my current position and not gamble on such an uncertain and volatile market.

There is no quick fix and it likely that the Pound will hit some type of glass ceiling for months and possibly years to come. Any clients holding out for GBP/EUR rates to recover above 1.30 and GBP/USD to hit 1.40 again this year are likely to be left disappointed.

If you have an upcoming Sterling 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 mtv@currencies.co.uk

Sterling rates rebound but for how long?

Figures on the economy lately have suggested the impact of Brexit is nowhere near as bad as it could be leading to the rise in the value of sterling as investors rebuy the pound to take stock of the improved expectations on the markets. The thing is all the new is basically old news, we know that the UK economy wasn’t in too bad a shape as we lead up to the vote which means that the early period following the vote has seen some robust data on some fronts. Let us look at what has helped the pound and decide whether or not this is likely to help the pound in the future?

If the markets are focused on the good news now they might fail to see the problems which could see the pound fall in the future. Quite simply if the UK businesses which are reporting big declines in orders and demand are correct then the coming months should see declines in the all important GDP data. What might help the GDP figures for the this quarter would be Retail activity which I feel due to the improvements in the weather and UK sporting prowess owing to the Olympics will be strong. This will in my opinion not outweigh the overall negative impact from a slowdown in business and GDP growth for the UK will come in lower which will see some job losses and a rise in Unemployment.

What will keep sterling on the back foot will be the uncertainty around any political developments with the Brexit, this could take well into 2017 to arrange. If you have any transfers involving sterling why delay making plans? For more information on the markets or our services please fill in the form or email me Jonathan personally on jmw@currencies.co.uk

Not all doom and gloom for sterling however a decline expected (Dayle Littlejohn)

Since the UK public voted out of the EU, a cloud of uncertainty has surrounded the UK economy and therefore sterling exchange rates. Many economists stated it was doom and gloom and that the UK would enter recession by Christmas. Some of the leading banks including HSBC exclaimed they thought GBPEUR would reach parity before the end of the year!

So far it seems as this is a slight overreaction. In fact UK retail sales and Unemployment numbers have exceeded expectation and exports are flying out of the UK because of the cheap pound. The golden question now is what next?

We have to remember the UK did cut interest rates this month and are now pumping a large amount of quantitative easing into the economy, which overtime should devalue sterling. Looking ahead there is still a chance the pound could devalue further if the Bank of England cut interest rates to 0%. In addition I still believe there will be a slowdown in the UK and therefore we will see a decline in sterling rates.

HOWEVER its important when trading sterling with a foreign currency that you analyse both currencies.

Are you buying euros for a property purchase in Europe? Are you selling US dollars to buy sterling because you get paid in dollars? Have you received inheritance in sterling however you live in Australia? Each scenario I would have a different strategy that I believe would maximise your return. Therefore its important I have a deep understanding of your requirements so I can help you!

My area of expertise is property purchases and sales. 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.

Feel free to email me on  drl@currencies.co.uk or alternatively fill out the form below.

** 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! **

Will Sterling’s rally vs the Euro and US Dollar continue? (Tom Holian)

Sterling Euro exchange rates have started to witness a recovery since falling to close to their lowest point in three years following the impact of the Brexit.

Economic data that is now being published since the vote to leave the European Union has not been as bad as expected and indeed UK consumer confidence is back to its best level since 2013 which has been reflected in Sterling Euro exchange rates.

Yesterday’s UK GDP data came out as anticipated with levels for the previous quarter at 0.6% which helped to provide Sterling with strength vs the single currency.

As we go into next week following the Bank Holiday the focus will return back to the Eurozone with the release of Industrial and Consumer confidence as well as German inflation data on Tuesday morning.

It will be interesting to watch out for this data as this could also provide support for the Pound if the results show a slowdown on the continent and a fall in confidence.

UK manufacturing data published earlier in the week showed levels back to the best in 2 years which demonstrates that the impact of the Brexit vote was not as bad as expected.

My view is that we could see Sterling continue to rise against the Euro as only 2 months ago we were over 10% better on GBPEUR rates and owing to the Brexit this is the main reason why rates have fallen by so much.

However, it appears as though the economy hasn’t struggled too badly since the vote and this could support the Pound vs the Euro and arguably also against the US Dollar.

Therefore, if you’re thinking about selling Euros to buy Sterling it may be worth looking at making a purchase before the Pound recovers against the single currency.

If you’re in the process of selling a property abroad and want to secure an exchange rate for a future date then it may be worth considering buying a forward contract, which means you know exactly what Sterling you will receive once your property has sold.

If you have a currency transfer to make and want to save money on exchange rates compared to using your own bank then contact me directly for a free quote. Tom Holian teh@currencies.co.uk

 

 

Sterling continues its recovery as UK growth estimates meet expectations, but will the recovery continue? (Joseph Wright)

It’s been quite a bullish week for the Pound this week as economic data releases have impressed and Sterling has gained a good few cents vs many other major currency pairs.

Towards the end of last week the UK’s Retail Sales Figures for July were better than expected, and this week the weak Pound has resulted in the UK’s Manufacturing Output reaching a 2 year high as people overseas are keen to pick up goods at low prices. These positive sets of data, coupled with today’s Gross Domestic Product estimates coming out as expected,  have boosted sentiment towards the Pound as this has been reflected within currency markets as the Pound has gained almost 3 cents vs the US Dollar, and almost 2 cents vs the Euro.

Those that plan to convert their Sterling into a foreign currency at a higher rate will of course be hoping that the Pound continues to climb, and whilst I think it may do, there are a number of risks to holding off so it may be an idea to make at least part of that trade at current levels with the hope of averaging up in future. This is an approach many of our clients are currently taking and we’re here to help by keeping them updated with what’s going on in the marketplace.

Those who plan to purchase Pounds, by converting their Euros,US Dollars or Aussie Dollars for example, may wish to get in contact and check whether our rates are better than your current providers/banks as whilst current levels are particularly favourable, a return to risky attitudes from investors is likely to drive up Sterling’s value, especially if economic data out of the UK continues to surprisingly impress.

Major economic announcements that could sway markets next week are Thursday’s Manufacturing Data which is expected to show an improvement, and then next Friday will be Non-Farm Payroll and Unemployment Data out of the US. If you would like to discuss these and how they can affect markets, do get in touch and I’ll be happy to explain.

If you would like to discuss an upcoming currency requirement you’re planning, in terms of the timings and getting the best rate of exchange available, feel free to contact me on jxw@currencies.co.uk  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 call in directly to reception and ask for Joe on 01494 787 478.

Sterling Exchange Rates before UK GDP Numbers (James Lovick)

The pound has seen an excellent rally against most currencies after a recent run of upbeat UK data. The most recent gains for sterling exchange rates have been as a result of the manufacturing export numbers from the Confederation of Business Industry which arrived at a two year high.

These numbers are for the post Brexit period which gives us some clues as to the real impact of the vote to decide to leave the EU. Furthermore it signals a very buoyant manufacturing sector which is excellent news for the British economy in what is an uncertain period.

The numbers complement the other better data from last week which saw unemployment hold steady at 4.9% but with an improvement in the numbers of individuals claiming unemployment benefit. The bumper retail sales numbers for July also painted a brighter picture for the British economy which have also helped support the pound.

With no UK economic data releases today then focus moves to tomorrows UK GDP numbers for the second quarter. These figures represent the 2nd quarter of 2016 and include the 3 month period in the run up to the referendum.

My view is that there is a chance that these figures may see the very slightest deterioration as many businesses may have scaled things back in the run up to the vote. UK GDP has also been on the decline throughout 2016 so a move lower to 0.5% cannot be ruled out. This would be sterling negative as it would potentially be seen as a precursor to how the economy will react post Brexit.

This data release has the potential to give new direction for the pound tomorrow. Anyone holding pounds to either buy or sell currency would be wise to get in touch to talk through your options.

If you have an upcoming GBP or EUR 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 James. Alternatively, I can be emailed directly on jll@currencies.co.uk

How will Friday’s UK GDP Figures Affect Sterling Exchange Rates? (Matthew Vassallo)

Sterling has found some much needed support over the early part of the trading week, recovering ground against both the EUR & USD. The Pound has benefited from some improved economic data late last week, with Unemployment data and UK Retail Sales figures coming in better than expected.

This in turn boosted GBP/EUR rates, with the pair hitting 1.1784 at the high and bringing some much needed respite to those clients holding the Pound, following weeks of devaluation. These losses were born out of a complete lack of confidence in the UK economy, with investors risk appetite dissipated by the uncertainty caused by the UK’s decision to exit the EU. This is and will remain to be the underlying reason behind Sterling recent demise, with the Bank of England (BoE) cementing the downfall with their recent interest rate cut. With the possibility of further monetary easing (QE) and/or another rate cut, we may see the situation get worse before it gets better.

GBP/USD rates have seen a similar trend, with the pair falling below 1.30 at the recent low. Despite an improvement above this threshold, I do anticipate a sustained recovery anytime soon, certainly not under current market conditions. The greenback has made huge strides since the turn of the year, in line with economic improvements in the US and despite the political battle between Donald Trump & Hilary Clinton heating up ahead of Novembers election, I do not expect a recovery back towards 1.40 until we at least have some clarity on when and how the British government are likely to facilitate our Brexit.

Once some of this uncertainty has been removed then the Pound has a better chance of recovering its losses but until then I would be looking to protect any short to medium-term Sterling positions, with further market volatility expected.

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, you can email me directly on mtv@currencies.co.uk

Could we have another Referendum?

Well well politicians are a right bunch aren’t they. Just as the UK economy was recovering following the worst financial crisis in living memory we have had the politicians calling this Referendum which has of course knocked confidence and no leaves us with plenty of uncertainty up ahead. It is far to early to be calling Brexit good or bad since we just don’t know what it is at present. For now the UK economy is ticking along nicely, it is growing, people have jobs and they are confident to be spending their hard earned cash as it has been a lovely summer. As I have repeatedly said however we cannot (unfortunately) rely on the weather to support the economy, still with the Olympic glory still fresh in everyone’s minds let us keep positive.

On the subject of Referendums we might yet have another one! Owen Smith the prospective Labour candidate has stated he will be looking to call another Referendum before invoking Article 50, putting the new deal to the test of a public vote. Owen Smith the potential future Labour leader has made this call as part of his campaign to be the new Labour leader. So far this is not wholly likely but the prospect remains.

If you have a transfer involving the pound the uncertainty is set to continue for many months and maybe years, making some plans in such uncertain times seems to me a very sensible option. To discuss further your options and the market please contact me Jonathan Watson on the form below or email me directly on jmw@currencies.co.uk

GBPEUR forecast (Dayle Littlejohn)

This week HSBC Holdings Plc and UBS Group AG have indicated the future is not bright for the UK due to the ‘Brexit’ and they both believe GBPEUR exchange rates will reach parity at some stage next year. For people buying euros this should ring alarm bells where as euros sellers should feel their are extra pounds to be made.

Personally I disagree with the forecasts. Italy and Greece (two countries within the European union) have problems of their own. Banks within both countries are struggling with debt and they have both eluded to breaking EU laws to stay afloat. I believe rates will fluctuate in the mid teens and over time will drop to 1.10, however I just feel the UK economy is in a better position than the Eurozone and that’s why we will not see parity.

Tomorrow morning the UK release their latest Mortgage approval numbers. A drop is expected which isn’t a surprise. The public at the moment are acting cautiously due to what they read in the press about the ‘Brexit’. Expect sterling weakness tomorrow morning.

If I have not covered the currency pair you are trading 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 drl@currencies.co.uk.

My area of expertise is property purchases and sales. 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! **

Is there any chance of a Sterling rally in the near future? – Pound Forecast (Daniel Charles Johnson)

GBP Forecast

Many of my clients are hanging on to sell there Sterling at present. Having watched GBP/EUR fall from 1.40 at the beginning of the year to the now painful lows of the 1.15-1.16s. It is extremely hard to predict with high street banks throwing out contradictory forecasts. Lloyds predicting a Sterling rally and HSBC predicting parity on GBP/EUR. Personally I feel as UK data starts to filter through for July we will see further Sterling weakness. UK retail figures went against the grain and came in better than expected. we did see a small rally for GBP but it was not sustained.  I feel the positive data cab attributed to an increase in tourism due to the weak pound and the rarity that is good British weather.

It is important to note that Ian McCafferty a member of the monetary policy committee has indicated that if UK data continues to come in below expectations than further monetary easing will be initiated. If I was looking to sell Sterling short-medium term I would be taking advantage of current levels.

If  you have a currency requirement it is crucial to be in touch with an experienced broker. The timing of your trade is vital during such a volatile  times, If you have an experienced broker on board he/she can keep you up to date with what is happening in the market to help you make an informed decision. If you would like me to assist with your trade I will be happy to help. If you inform me of the the currency pair you are trading, volume and time scale and I will provide a free trading strategy to suit your needs. I work for one of the top brokerages in the country and as such I am in a position to beat nearly every competitors rate of exchange. You would be looking at around a 4% saving in comparison to high street banks. Please do get in touch by contacting me at dcj@currencies.co.uk. Thank you for reading my blog. The quickest method to get in touch is by filling in the form below and we will be in touch ASAP.