Monthly Archives: October 2016
Despite a relatively bullish day for the Pound, particularly by its own recent standards, the currency is on track for it’s weakest month since the month of the Brexit vote back in June.
The reason behind today’s bullish Pound is a meeting between the Governor of the Bank of England, Mark Carney has had a meeting with Theresa May (UK Prime Minister) regarding his future, and the general feel around it so far is positive as just prior to their meetup, May announced that the Governor has her full support.
There were rumours in the city last week that Carney would shortly be announcing his planned departure in 2018 but as it stands that doesn’t seem to be the case. I think that if he decides to extend his stay until 2021 and complete a full 8-year term we could see the Pound spike upward once again but certainly not back up to the levels we saw at the beginning of October.
This uncertainty surrounding the key figure of the Bank of England has not come at a good time for the Pound’s value, after we’ve already seen the currency lose almost another 5% through October after Theresa May outlined the end of March as the time to invoke Article 50.
This week is set to be a busy one in terms of economic news releases, with Thursday expected to be the busiest day for Sterling exchange rates as it’s the day of the BoE’s next Interest Rate Decision. Mark Carney will also be speaking that day so feel free to get in touch to discuss any planned currency exchanges in more detail as planning around these events could be key.
If you want to be kept up to date on the markets and you would also like to ensure that you are getting the very top levels of exchange for an imminent currency transfer or even a longer term one then I can help you with this.
Not only do we give clients up to date market information but we all work for one of the largest and longest serving currency brokerages in the U.K, so even if you have dealt with your current broker or bank for a long time I would be surprised if I could not show you a saving over what they are offering you – You can email me (Joseph Wright) directly on firstname.lastname@example.org and I will be more than happy to contact you personally to discuss the various options we have available to you.
The main talking point this week were the GDP numbers released Thursday morning. Gross Domestic Product numbers measure the total goods and services produced by the UK and is a key barometer to the strength of the economy. The consensus throughout the financial industry was a major fall because this was the first quarterly release since the UK public decided to vote out of the European Union. However the decline was not as bad as many economists were predicting. The quarterly figure was released at 0.5% (prediction 0.3%) and the yearly figure at 2.3% (prediction 2.1%).
As for sterling exchange rates you would have thought the pound would have had a good finish to the week however this was not the case and the pound continued to deprecate to the close on Friday. This is a common trend clients have got used to over the last 4 months.
This week the Bank of England release their latest interest rate decision and this release should be watched closely if you are buying or selling the pound for the remainder of the year. Before the Brexit vote it looked like the Bank of England were close to raising rates, how times have changed. We have already seen a cut by 0.25% since June 23rd and the golden question now is will the Bank of England cut rates this Thursday?
Many economists have predicted a cut to 0.05% however I’m sceptical. With GDP numbers exceeding expectation last week this gives the monetary policy committee a reason to hold off. It’s important to consider if members of the MPC vote in favour of cutting and I expect one or two will, the pound could still devalue, consequently buying currency will become more expensive.
If you are reading this website in order to find out information in regards to buying or selling the pound I can help you achieve the best exchange rates on the market whilst keeping you up to date with economic information. Common clients I deal with are business owners, high net individuals and people buying property abroad.
Its important to analyse both currencies that you will be trading therefore I would recommend emailing me with the currency pair (GBPUSD, GBPAUD, GBPCHF etc) the reason for your trade (company invoice, buying a property) and I will email you with my forecast and the process of using our company email@example.com.
** IF YOU ARE ALREADY USING A BROKERAGE TO BUY YOUR CURRENCY IT WILL TAKE TWO MINUTES TO EMAIL FOR A COMPARISON AND I AM CONFIDENT I WILL BEAT ANY PRICE YOU ARE CURRENTLY RECEIVING **
We are now less than 2 weeks before the US goes to the polls to deicde whether Hillary Clinton or Donald Trump will become the next US president. At the moment it appears as though Clinton is leading in the polls with 49% compared to 45%. However, as the Brexit proved polls can be very unreliable.
The US economy is going from strength to strength and yesterday GDP figures for the third quarter came out at 2.9% in the three months to September according to the US Commerce Department. Jobless claims also showed that unemployment levels are falling so everything looks to be on course for an interest rate hike in the world’s leading economy.
To me I think the US Federal Reserve have more than enough reasons to increase interest rates but with the election looming I think they are waiting to see what happens with the next president.
The GDP figures for the year showed 0.4% better than the expectation of 2.5% and this has seen GBPUSD exchange rates fall to close to their lowest level in 31 years.
Even though this week the UK posted better than expected GDP data this did little to improve the Pound vs the Greenback and this highlights the problems that the UK is facing with the announcement that Article 50 will be triggered by March 2017. Since the Brexit Sterling has fallen dramatically and I think we could see further falls ahead for Sterling exchange rates against all major currencies. Indeed, Sterling is the world’s worst performing currency on the global money markets this year.
Having worked in the foreign exchange industry since 2003 I am confident that I can offer you bank beating exchange rates and also help you with the timing of your currency transfer.
If you have a currency transfer to make and want further information or for a free quote then contact me directly and I look forward to hearing from you.
Tom Holian firstname.lastname@example.org
Alternatively fill in the form below
Sterling Euro exchange rates have fallen yet again even though UK GDP figures came out better than expected yesterday morning. This was the first quarter after the Brexit vote and although the figures were good the gains were very short lived for the Pound vs the Euro.
The real issue for the Pound is that it’s likely to remain under pressure for quite some time owing to the political instability surrounding the announcement of Article 50. Since the start of October we have seen GBPEUR exchange rates fall by as much as ten cents from the high to the low and in such a short space of time this is very concerning particularly for anyone looking to send money to Europe.
Bank of England governor Mark Carney and deputy governor Ben Broadbent have also recently spoken about the value of Sterling and have not shown too much concern so with the Bank of England due to meet next Thursday I think we could even see an interest rate cut happen.
Indeed, Carney claimed that the interest rate cut put in place post-Brexit helped to save a huge amount of jobs and settle the economy caused by the vote to leave the European Union back in June.
Even if the Bank of England do not cut interest rates next week any signals of one coming could cause Sterling to fall even further against the Euro. Therefore, if need to buy Euros before the end of the year then it may be worth buying a forward contract which means you can secure the current exchange rate removing the uncertainty caused by fluctuating exchange rates.
Having worked in the foreign exchange industry since 2003 I am confident of being able to offer you bank beating exchange rates when buying or selling any major currency and also help you with the timing of your transfer.
If you have a currency transfer to make and 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
We have had numerous factors that were positive for the UK economy over the last few days. Nissan pledged to build several new models in the UK, a new runway at Heathrow has moved a step closer and GDP data came in better than expected. These factors would usually have influence on Sterling but the uncertainty surrounding trade negotiations, labour and inflation have put a halt to any Sterling rally.
GDP was up by 0.2% and this would usually cause a Spike for the pound, but if we look at GBP/EUR there was a rise of around 40 pips and GBP/EUR quickly fell back below 1.12. With the other factors stated above as catalyst the pound should have moved significantly higher. This is a worry. Investor confidence is clearly low.
The CETA deal between Canada and the EU should be approved tomorrow, but it does not bode well for UK negotiations if the CETA deal seven years in the works was nearly scuppered by a small region in Belgium. A soft Brexit would be the sensible option, but Jean Claude Junker and Francois Hollande have mad it clear negotiations will not take place until article 50 is triggered. I think in order for Sterling to rally article 50 must be invoked and negotiations must be quick and decisive. Don’t hold your breath.
Currency Pairings in Detail
The greenback is currently is at a 31yr high. The last time rates were this good for dollar sellers Duran Duran were number one and Back to the Future was top of the box office. Although sellers may be tempted, there is the possibility of further gains. If Clinton gets in (factored into the market to some extent) the dollar will strengthen but perhaps which could cause more strength would be a rate hike in December which is highly probable. Add in the Brexit problems and we could be below 1.20 shortly.
Short to medium term the pound could have further losses, many analysts are predicting as low as 1.05 in December. This could we ll be the case, but the Euro has some serious problems which could cause substantial weakness for the Euro. Italian Bank’s bad loans totaling €360bn, the threat of further referendums, Greece’s debt crisis and the seemingly impossible task of stimulating inflation.
Aussie sellers are now at a three year high. Australian Dollar strength is causing a problem for the RBA however. It is putting the Chinese off Australia’s raw materials and they may seek a cheaper option. This problem would usually be solved by dropping interest rates to weaken the currency , but rates were cut recently and did little to weaken the Aussie. With the RBA seemingly powerless to weaken the Aussie expect the pound to fall further.
If you have a currency requirement it is vital to have an experienced broker on board to help you make an informed decision on when to trade and what contract to utilise to maximise your return. I am in a position where I can confidently say I will beat any competitors rate of exchange. If you would like free assistance please do not hesitate to get in touch. Feel free to e-mail me at firstname.lastname@example.org. Thank you for reading my blog.
Tomorrow morning sees the release of UK GDP figures for the third quarter which is the quarter immediately post-Brexit and this could see GBPEUR exchange rates and GBPUSD exchange rates move very quickly both before and straight after the data release.
If we see the figures come out lower than expected then this could see Sterling fall very quickly against all major currencies as it will reinforce the problems caused by the vote to leave the European Union.
Yesterday Bank of England governor Mark Carney spoke at the House of Lords Economic Affairs committee concerning the Brexit issue. Carney has been criticised by some senior MPs as well as Theresa May for some of his comments since the Brexit and during yesterday’s meeting he hinted that he may not renew his contract when it’s due for renewal in 2018.
Indeed, both Mark Carney and Ben Broadbent who is the deputy governor of the Bank of England have said that they don’t appear to be too concerned about the value of Sterling so to me this could point to an interest rate cut at next week’s central bank meeting and typically an interest rate cut results in weakness for that particular currency.
Therefore, if you’re thinking about selling Sterling to buy Euros or US Dollars then it may be worth looking at organising this before next week’s interest rate decision.
If you don’t have the full amount of funds available at the moment then it may be worth considering buying a forward contract which allows you to fix an exchange rate for a future date and this will help to avoid the uncertainty as to where rates may move.
Having worked in the foreign exchange markets since 2003 for one of the UK’s leading specialist currency brokers I am confident that I can offer you better exchange rates than using your bank when buying or selling any major currency and also help you with the timing of your transfer.
To find out more 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
Buying Euro and Dollar rates took a further slide this afternoon as markets were gearing up for Mark Carney’s appearance in front of the House Treasury Committee.
Mark Carney is the Governor of the Bank of England, and given the recent shock to the UK economy, this currently hypersensitive market was approaching the news release with baited breath.
The bread and butter of what markets were hoping for was some kind of indication as to what the highly anticipated growth figures for markets on Thursday may reveal.
In the run up to the event a nervous market revealed itself, with falls recorded on GBP/EUR, GBP/USD, and most noticeably on GBP/AUD.
It seems that most investors in commercial markets were keen to relieve themselves of any risk ahead of the event itself so sold Sterling off in droves to protect themselves. Unfortunately, with Sterling’s value lowering through decreased demand, this hurt anyone with a private Euro or Dollar purchase.
As my Sunday post detailed this week was fraught with risk for anyone buying a foreign currency and we are already seeing this manifest on the exchange rates.
Thursday is the first look at UK growth figures since the recession, and whilst Carney gave little away in his speech today, we have learned a valuable lesson that markets are risking little this week. It’s likely in the run up to the news on Thursday we will be seeing similar drops on Sterling as markets avoid gambling on what will be an important data release for the UK economy.
My opinion has not changed and as such I strongly recommend that anyone with a buying Euro, US Dollar, or Australian Dollar requirement should contact me on firstname.lastname@example.org to discuss a strategy on how to protect your upcoming transfer from any adverse movements and maximise your currency return with what is available in this current marketplace.
I have never had an issue beating the rates of exchange on offer elsewhere, and as such a brief conversation could save you thousands on an upcoming transfer.
You can also contact me on the form below whilst markets are quiet overnight and I will respond to you as soon as I am able.