Tag Archives: GBPEUR exchange rates

How will UKIP affect sterling?

UKIP continue to make gains in polls and are certainly likely to be a thorn in the side of the more established parties, indeed they already have been. But is this more a reflection of the tough times ahead for the UK (and the pound) or a flash in the pan protest vote?

UKIP have the power to severely undermine confidence in sterling. there is tremendous uncertainty posed by a party with no solid economic idea from what I have seen. Aside from promising to withdraw from Europe and playing on peoples immigration fears it is difficult to find concrete policy. Let it be known that any withdrawal from Europe would have wide reaching consequences for the UK economy and hence the pound. Whilst it might be welcomed we examine the relationship with Europe the economic benefits of being part of Europe should not be underestimated.

We shall learn much more about the true effects of UKIP on the pound in the next few months as we have bi-election and then the General Election in May 2015. The effect on sterling from increased political uncertainty will undoubtedly be negative and anyone hoping to see sterling keep climbing in 2014 and beyond might be disappointed.

To keep up to date with the pound and how important events affect your exchange please contact me Jonathan on jmw@currencies.co.uk

Will it be a busy and positive end to the week for the pound?

Early indications suggest yes! The pound has clearly been the favourite currency of 2014 as the UK leaves its counterparts behind with solid economic growth and economic policies all pointing towards raising interest rates. For me this trend is not finished and whilst the pound has clearly come slightly unstuck this October (the month economic realities often hit home, remember the Wall St crash?) longer term sterling really should remain the investors choice.

Risks remain from the Eurozone slowdown (40% of the UK’s overseas trade is with the Eurozone) and a general deterioration in the global economic outlook but on balance the UK is benefiting from improved domestic demand and whilst it may be that sterling does dip a little more as interest rate expectations are pushed back, I still believe the UK will raise interest rates ahead of the United States. I therefore view any dip in sterling as a buying opportunity well worth capitalising on.

Tomorrow’s Retail figures will be a big indicator as to whether or not the this domestic demand is sustainable and Friday’s GDP (Gross Domestic Product) will again be very indicative of just exactly how the UK is faring, I would personally expect sterling to fall tomorrow but rise Friday. If you are considering an upcoming exchange why not speak with me to learn a little more about the forecast?

What exactly should I do? I cannot unfortunately tell you exactly what to do or when to buy the currency, no one can! I can however keep an eye on the rates for you and highlight improvements and upcoming events which will affect the exchange. The uncertainty of the foreign exchange market means making firm decisions is impossible and it is only by speaking with a true specialist you can fully understand what may happen down the line.

For more information please contact me Jonathan Watson on jmw@currencies.co.uk

UK Unemployment Falls leading to Sterling Strength (Tom Holian)

GBPEUR exchange rates have fallen from levels of 1.28 in the last fortnight into the 1.25 region following a period  of weak data for the UK economy and also Sterling.

Yesterday’s UK inflation data was alarmingly low compared to the expectation which means the Bank of England is less likely to raise interest rates any time soon. An interest rate rise would typically strengthen the Pound and this data has caused Sterling to weaken.

However, all is not lost as this morning UK unemployment has shown a big fall and now below 2 million which is very good news for the British economy.

According to the Office for National Statistics the unemployment rate has now reached 6% and the lowest level since 2008. Now there are over 30 million people in work in the UK. With Eurozone unemployment above 12% at the moment this news has helped Sterling regain some of its recent losses against the Euro.

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

 

 

 

Sterling rates are looking very tempting now….

As we get closer to the general election in 2015 the pound will become vulnerable, just look at what the uncertainty surrounding Scotland did to the pound. If you are buying an overseas property or planning business forecasts in 2015, this will pass very quickly.

Very importantly for October Business confidence and spending generally is likely to have dipped in September so the releases this month which have already shown losses for the pound are likely to continue and underlines why current levels should not be ignored.

If you are considering buying or selling the pound in the future making some careful preparations is always sensible. Contact me directly on jmw@currencies.co.uk

 

Sterling could be in for a very tough Winter…

Sterling has had a truly remarkable year making firm gains against pretty much all currencies and presenting some of the best rates to buy a foreign currency with in years. GBPUSD hit a 5 year high, GBPEUR has hit a two year high (and not far off a 6 year high!) and GBPNZD and GBPAUD are also both at multi year highs… Clearly sterling is faring well but this now begs the question will it continue?

October is looking like a tough month for the pound  with economic releases from September’s data likely to be poor owing to lower business and consumer confidence due to the Scottish referendum. I feel this is likely to feed into the rest of the year and with it interest rate hike expectations (currently expected in April) liable to be pushed back further. Economic growth in the UK is currently running at 0.8% and with house prices not rising as fast as previously I think the need to raise rates will dampen in Q4.

Tomorrow is some very important Eurozone news on Inflation which will be indicative of how much QE we can expect Thursday from the ECB. With so much volatility surrounding this release making some careful plans ready to trade on the news seems sensible.

I couldn’t possibly fit everything important in one post, would you read the whole article anyway? So if you need to consider a currency exchange and wish for further information please contact me directly on jmw@currencies.co.uk. I work as a foreign exchange dealer and we focus on a personal proactive service to help you get the most from the market. Please contact me for more information regarding your situation.

Will sterling continue to rise

The pound remains at elevated levels and it would appear it shall continue to do so. Expectations of Quantitative Easing in the Eurozone next month are keeping the Euro weak and following the dollar’s recent surge investor appetite for favourite the safe haven looks set to remain cooled for the time being.

The pound was looking in serious danger on the back of a possible Yes vote in the referendum but these fears have now cooled with the No vote. There are however significant reasons for concern for GBP weakness down the line with the UK election and the possibility of the EU referendum to follow. These topics could make the Scottish referendum look like a Parish Councillors meeting by comparison…

All in all the news is generally very positive for the pound at present but further gains in the absence of something ‘new’ to impress investors look limited. If you need to buy a foreign currency with sterling capitalising on these extremely impressive levels might be the best course of action. To be notified of any impressive spikes please contact me Jonathan on jmw@currencies.co.uk

 

Scottish Referendum still dominating the headlines and causing wide swings for sterling exchange rates. (Ben Amrany)

So we are getting closer and closer to the key Scottish referendum tomorrow. The markets over the last couple of weeks have been extremely volatile purely on the back of will the YES or NO campaign be victorious. We are expecting voting to start tomorrow with the decision filtering through in the early hours of Friday morning.

The way that I see it is as follows. There is likely to be a major reaction for sterling, whichever way the vote goes. A vote for independence will highly likely result in a massive sterling sell-off causing the pound to fall by as much as 10% over the coming weeks and months. A vote for Scotland to remain in the UK is likely to lead to a significant relief rally for the pound and we could see a slight gain from the current trading levels.

One of the main reasons why the pound could decline by so much and for so long should the YES campaign win would be due to the reaction from the Bank of England. Interest rate hikes could be pushed back further from the expected Spring 15 target and another bout of Quantitative easing has been muted to get the markets moving should the unlikely happen. This could be disastrous for those looking at buying EUR, AUD, NZD & USD.

For those looking at selling the pound the risk to gain ratio is not worth taking the gamble on what may occur. With the polls so close at the moment the risks of losing thousands of the currency you need to buy by waiting until after the vote could be extremely costly and we have seen many clients capitalise on the current rates due to the uncertainty. Although we believe the NO vote to independence will happen it is not inconceivable that the polls and bookies are incorrect and we could be in for one of the largest historical shocks of our time.

So if you need to buy or sell sterling and would like to be kept up to date with all the latest data releases and exchange rate movements then speak with myself Ben Amrany and I will explain the options available to you and how best to minimise any risks you have on the currency.  You can email me at bma@currencies.co.uk 

In other news the Minutes from the Bank of England’s last interest rate decision showed no change in the voting with a split of 7-2 not voting for a rate hike. Unemployment also dipped slightly which assisted the pounds gains so now eyes will be firmly on retail figures tomorrow and that key vote.

Thank you for reading.

Ben Amrany

bma@currencies.co.uk 

 

 

 

 

 

The pound surges in late trading but further losses are expected in the days to come. (Ben Amrany)

Sterling has today had an extremely volatile day’s trading all mainly due to the uncertainty of the Scottish referendum. It is currently playing havoc with the pound and today we have seen a high to low spread against the Euro from 1.2397 to 1.2543 and over a cent high to low against the USD.

The last poll showed there was a 50/50 split but we are expecting an update tomorrow and any signs that the YES vote is ahead once again expect to see further sterling losses. The Swings in the market is going to show how nervous the UK markets are about Scotland voting in favour of independenceand several news reports have highlighted how damning it will be for the UK economy.

Here we have seen a massive increase in the volume of clients buying and selling the pound as the uncertainty is very concerning. With reports that a YES vote could cause the pound to fall by as much as 10% if you are buying or selling sterling you have to ask yourself how much risk to gain ratio you want to take on your exchange because even if a NO vote (which we do expect) happens the pound may only climb by 1-2%. If you take into account what the losses could be it is just not worth the gamble in not exchanging your funds now. This time next month we could be as high as 1.27 or as low as 1.17. This is a real likely spread depending on the outcome and you may be wise just to know how far your funds are going while the rates are still favourable.

So if you are looking at buying or selling a specific currency you may be wise to speak with myself Ben Amrany and I can explain all the options available to you to help you minimise your losses while helping you achieve a much better rate than what the high street banks will offer. You can email me with your contact details and requirement at bma@currencies.co.uk and I will contact you to explain the current market place and  how best to minimise those losses.

Thank you for reading

Ben Amrany

bma@currencies.co.uk

 

 

 

Ignore the Scottish Referendum at your peril!

I first wrote of the negative consequences of the Scottish vote in May (which you can read here) and so far have not been proved wrong. The Yes campaign has been massively underestimated and the lack of economic clarity from either side has the pound reeling.

It would be most damaging for the pound if Scotland did declare independence since interest rate expectations would be pushed right back as the Bank of England needed time to assess the fallout from such a move. There would be many months of political and legal wranglings over currency and exactly how debts would be split, all of this would not fit in with most investors more recent views of a ‘United’ Kingdom finally on its path to future economic success. The strength of sterling this summer is primarily down to interest rate hike expectations which remain high but if pushed out would cause the pound to go lower.

So how do I trade the Scottish Referendum, when should I buy or sell my Sterling?

It seems doubtful any yes vote would triumph but with the spread between the yes and no vote having reduced from 22 points to 6 in recent polls, it would be foolish to ignore the potentially major repercussions on the market. The fairly heavy sterling losses since Monday could be indicative of what will happen ahead of the referendum. Often in these situations the currency concerned would strengthen following the result as it provides certainty again. I think therefore if you need to buy the pound look out for spikes in your favour and move before the referendum, if you are too busy to watch the market part of our service is to monitor rates for clients, just drop me a note on jmw@currencies.co.uk.

If you are buying a foreign currency with the pound you might want to move very soon or wait until after the referendum to see if the rate goes back up. However there are no guarantees any dent in confidence will be restored, there is a likelihood the losses for sterling will intensify as we approach the referendum date 18th September.

Having some sort of currency strategy is always sensible and we work as currency specialists expert in the safe transfer of money internationally at commercial exchange rates. If you would like any information or assistance concerning a transfer you need to consider I would be happy to hear from you and offer some practical solutions.

Jonathan

jmw@currencies.co.uk

Sterling back below 1.25 against the Euro (Ben Amrany)

After yesterdays bank of England which gave the pound a real boost after two members of the Bank of England voted for interest rate hikes we have seen the pound lose all of its gains against the Euro, USD and the southern hemisphere currencies. The losses have been on average about 0.3%

The Euro is now below 1.25 the Dollar is in the 1.65’s and this is a massive decline compared to two weeks again when the rates were above 1.26 & 1.70 respectively. The losses today occurred when retail figures showed a decline from the anticipated rate and has hindered the pound.

All data at present is having a real time effect on when the markets predict this first interest rate hike in the UK. The quarterly inflation report a couple of weeks ago hindered the pound when interest rate hike expectations were put back to February 2015 at the earliest now and all UK data which comes out negatively can theoretically push back this data back. We are expecting this dip for the pound to cement itself between 1.24 and 1.2550 over the next couple of weeks.

Tomorrow there is no data to note of out of the UK and we could find a very dull end to the week and with a bank holiday on Monday the markets should be flat until Tuesday. If you are looking at buying or selling you may wish to asses things before the long weekend to make sure you do not get caught out of there are any big movements.

With contracts available like forward buying where you can secure what you need now and pay for it at a later stage this can help you budget to the full and give you the peace of mind to know how far your funds are going. For more information on this or any other part of the service we offer please do feel free to contact myselfBen Amrany at bma@currencies.co.uk 

Thank you for reading

Ben Amrany

 

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