Tag Archives: GBPEUR exchange rates
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 firstname.lastname@example.org
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 email@example.com
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 firstname.lastname@example.org.
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.
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 email@example.com
Thank you for reading
Tomorrow is a vital day for sterling exchange rates.
We expect a further decline in the Unemployment rate , sterling may find a lift on the back of continued improvement in the number of people in work. Also released at this time is the Claimant count which measures the number of people claiming Jobseekers Allowance. Changes in the rates of Earning and Wage growth is bound to attract attention too since concerns remains about the extent to which improvements in the economy are being reflected in better wages for workers. There is fair scope for sterling strength and weakness therefore as the different elements of the ‘Unemployment’ data are released.
To really maximise this event you might want to put a ‘Limit’ or Stop Loss order into the market, this guarantees your rate once the price is hit. With such quick turns on the exchange rate this is the best way to maximise your transaction. Have you made provisions for volatility today? Are you concerned that your bank or broker might not quite be getting you the ‘best deal?’. Email me Jonathan on firstname.lastname@example.org and let me see if I can help out.
Key Data for Wednesday – Bank of England Quarterly Inflation Report 10.30 am. Once the labour data has hit home there is a only a small window within which to assess the situation before the Bank of England report of key economic topics and we have a speech by Mark Carney. Sterling has soared this summer on expectations the Bank will raise the interest rate sooner than expected but I feel too much has been placed on these comments. Sterling strength might be good if you are buying a new home in France or paying Invoices from Germany but it has a detrimental effect on UK business as they lose their competitive advantage. Lately many UK business have grabbed headlines bemoaning the strong pound and the millions wiped off in profits. I will be watching for any comments on the detrimental effects of a strong pound, the recent worse data for the UK – lower GDP plus a declining rate of growth in the Industrial and Manufacturing sectors all points to slightly worse prospects for the UK economy up ahead and therefore a slightly weaker pound.
Thursday will see Euro data take stage – Important if you are tracking GBPEUR. At 08.00 am German GDP is released which will be very interesting since German Industrial Output posted a shock fall last month. The famous German ZEW survey today showed investor sentiment at a 20 month low for Eurozone’s biggest economy. With Inflation and Growth concerns rife the data at 10.00 am – Eurozone GDP and Eurozone Inflation all become very significant in determining just where rates will head.
Last year GBPEUR dropped to 1.14 and GBPUSD 1.48. On both currency pairing and pretty much all other sterling rates we are around 10% higher than last year. There are never any guarantees on the market but tomorrow’s data looks like it could easily affect current levels, what do you need to do?
If you need to make an exchange understanding what moves the market is key to getting the best deal. We offer a personal, proactive service to help you get the most from the market as well as offer an award winning exchange rate when you do trade. To compare notes or run through all of your options please feel free to contact me Jonathan Watson directly using email@example.com.