Tag Archives: GBPEUR exchange rates

Will the Pound get weaker?

I’ve received a large number of emails this morning asking whether the Pound will weaken, it is of my opinion that the Pound will weaken in the foreseeable.

There are a number of factors that we need to consider now that the UK has decided to withdraw from the EU. Firstly, we do not have a date for when the UK will officially withdraw from the EU, this creates an extended period of uncertainty for the UK, which could have implications for businesses. Organisations have to make key decisions on how they manage business policies, expenditures, and expansion. Trade could change, prices could change, employment could change.

How will expatriates deal with the news? Will they return to the UK over fears of losing their rights? How will this impact international estate agencies?

But the bigger question, how will this impact the British economy? If the BoE, the majority of economists and financial institutes all agree that a Brexit could pose negative implications on the UK, what impact will this have on the Pound.

If we look at the timeline of events, the Pound slumped on a leave vote, David Cameron stepped down, Scotland are in the midst of calling their own Referendum and this is only just the beginning.

A new Prime Minister will be elected to trigger article 50, the UK will then be given a deal by the EU which the German Finance Minister Wolfgang Schauble states, is unlikely to be a good one.

In my honest opinion, based on the above alone, Pound Sterling may fall further and if I had a large amount of Euro’s or US Dollar’s to buy, I would be doing it sooner rather than later.

The best way to predict the future is to create it!

The next 48 hours and next week could see excessive volatility on sterling exchange rates with swings of up to 10% not unexpected. If you are considering a currency exchange in the next few weeks or months the decision today and tomorrow could change your rate dramatically, now is not a time to be too complacent! On a Leave vote the pound could slip by up to 10 or 15% according to some reports whilst a Remain vote will see the pound rise by I would say 5-8%. At the moment the market has priced in a roughly 70% chance of a Remain vote so the big risk in this event will be the Leave vote which would seer the rates fall so dramatically. If you are considering a trade currently and wish to check your exchange rate or get some useful information on options please speak to me Jonathan on jmw@currencies.co.uk.

A Leave vote will signal big changes and uncertainty as the pound will be subject to big changes in the UK’s relationship with Europe and the wider world. The Brexiteer argument will suggest this will open up new opportunities but I don’t think anyone can deny the potential negative impact a vote to Leave on the economy. At the moment we just don’t know exactly what will happen in the future and therefore I would suggest a Leave vote is the big risk to the pound.

If you are considering a transaction in the future I would strongly suggest making some plans in advance is a very sensible move to try and avoid the risk of losing a great deal of money. Excessive volatility on the exchange rate could cause great distress and hanging on to see what happens might prove very costly. We are working around the clock to support anyone who has a currency transfer to consider, if there is anything you are looking to do or to receive information on please speak to me Jonathan on jmw@currencies.co.uk

Why are buying Euro and Dollar rates rising gradually? (Joshua Privett)

Overall during the past few weeks, buying Euro and buying Dollar rates have seen net losses in the run up to the Referendum vote, which articles on this website have covered extensively.

However, now that we find ourselves closer to the vote itself, and with no real change in the polling data, this flop on the Pound has suddenly abated, and even marginally reversed. Is this something we can expect moving forward?

There is no straight answer unfortunately. Markets are wound very tight, and with so many parties looking to move at a moment’s notice, the whole Cent gains or drops on buying Euro or Dollar rates we saw on occassion last week will be happening again this week, more regularly. It is simply a matter of when.

At this point it still seems more likely than not that there will be losses on buying rates rather than gains. The Pound’s marginal strength last week can be accounted for in the positive retail sales, wage and employment figures posted last week. With the hiatus brought on in Referendum campaigning from the tragic death of Jo Cox, this was likely allowed more traction on the value of the Pound than it otherwise would be.

Polls will be governing everything from here on out. It is difficult to know how the public will behave in the final week in the run up to the vote. Will the polls reflect cold feet or a steadfast 50-50 split as we currently see it?

In these situations it is best to play it by ear, particularly if you are planning to buy Sterling and take advantage of any sudden sell offs of the Pound ahead of the vote and the cheaper prices this entails.

If you have Euros or Dollars to sell, you can contact me overnight on jjp@currencies.co.uk. I offer a personalised service here to make sure you are kept abreast of market movements, for both opportunities and negative turns you should be made aware of.

Anyone holding Sterling and considering buying another currency, can contact me as well, though your answer from me will likely be more pressing. I can provide a live quote for your transfer to alleviate the risk of the upcoming vote should you wish, and I have never had an issue beating the rates of exchange offered elsewhere.

 

Anticipated EU Referendum outcome to continue to drive GBP exchange rates (Joseph Wright)

This time next week we’ll know the outcome of the EU Referendum, and I think it’s fair to say that we can expect a bumpy ride for Sterling exchange rates between now and then.

The downward pressure on the Pound would seem to have eased somewhat over the past few days, and this could be due to the lack of campaigning from either the ‘leave’ or ‘remain’ camps after the tragic death of politician Jo Cox. Additionally, yesterday the Bank of England’s Interest Rate decision went largely unnoticed which was unsurprising. It would be a huge shock to have seen the BoE make a change so close to the vote especially after the Fed Reserve over in the US has made us aware that ‘Brexit’ uncertainty has been one of the main reasons that there’s been no changes to US Interest Rates recently.

The quiet couple of days for the Pound have seen it climb slightly, and at the time of writing the central level is 1.2685 which is comfortably above the average of roughly around 1.25 over the past 10 years.

From a personal standpoint I believe the Pound is overvalued if only slightly. I’m surprised to see the central level above 1.25 this close to the Referendum and I think anyone selling Pounds in order to purchase Euro’s can currently do so at favourable levels considering the monumental event next week.

Despite the relatively quiet couple of days we are seeing sharp movements of sudden whole cent gains or losses at times during the day, and I think we can expect to see an increase in volatility levels next week.

If you have an upcoming currency exchange to make involving the Pound, feel free to get in contact with 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 on 01494 787 478 and ask reception for Joe.

Waiting until the 23rd June might be too late!

If you are looking to maximise a sterling conversion whether buying or selling the EU Referendum is the best chance in years. This is bigger than the General Election last year where we saw 5% movement on sterling in the week of the election. It is bigger than the Scottish Referendum where we saw GBPEUR rise 5 cents on the result. The EU Referendum could be more like the pulling out of the Exchange Rate Mechanism (ERM) in 1992 where the rate plummeted by 20%. The thing is despite the pound falling by almost 10% already so far this year and about 15% from the highs last year the pound is still at quite favourable levels for buying many currencies compared to where we were during the Recession.

Client buying euros with pounds might remember when the rate was almost 1 to 1, it was a real gem to suddenly have rates to buy Euros above 1.20. On the Aussie clients selling pounds had to tangle with exchange rates of 1.50-1.6 making the current rates on offer of 1.9 and 2 not too bad at all.

‘Waiting to see what happens’ on the 23rd June could lead to disappointment as this might be too late! Now is the time to be making plans for any exchange rates you are looking to secure. Whilst Remain is pretty much the favourite, the Leave camp has been gathering real pace and nothing should be taken too much for granted.

If you have a particular exchange in mind why not highlight your position to us so we can help? We offer a personal proactive service to not only help with the timing and planning of any exchange but to also offer a better exchange rate than other companies. To find out more all you need to do is email me Jonathan Watson a brief description of your position on jmw@currencies.co.uk. What have you to lose? Waiting until after the 23rd June might be too late…

 

Brexit Update (Daniel Charles Johnson)

If you have a currency requirement involving Sterling the EU referendum is a key factor in your trade. Swings in the polls are influencing the value of Sterling heavily. The Leave camp currently have the momentum in the majority of polls which is why we have seen the pound weaken against the majority of major currencies. It is worth keeping in mind that the bookies still have the remain camp as favorites. Betfair currently have the remain camp in front at 72%. The bookies put their money where their mouth is and called both the Scottish referendum and general election correctly.

If you have a substantial transfer to make I think the safe option is to hedge. The last thing you want to do is put all your eggs in one basket and then find out your 15 cents worse off after the referendum.

GBP/EUR

The trend at present seems to be a a weakening pound due to the majority of polls showing the leave camp in front. If you are buying Euros I would set a realistic target rate of 1.29 to move. Sellers, If we hit the 1.26s. This morning at 9.30 we will see UK trade balance figures where I expect a slight decline, although I would not expect see too much market reaction.  Look out for UK inflation data on Tuesday at 09.30 which has been know to cause volatility and retails sales figures on Thursday at 09.30. There is the BOE interest decision on Thursday but I expect this to be a non-event.

GBP/USD

Due to global economic uncertainty and the uncertainty created by the general election I think an interest rate hike this year is off the cards. If I was a USD seller I would be tempted to move at current levels. GBP/USD has only fallen below 1.40 on a handful of occasions in the last 40yrs so 1.44 is definitely not a bad time to move.

GBP/AUD

The Aussie has had a prominent rally of late, but I think it will now lose steam. After record GDP and unemployment figures I think it will be difficult to have further gains. The RBA have indicated their wish to weaken the currency and with a general election around the corner I would expect to see the Aussie lose ground.

If you have a currency transfer short term it is vitally important that you are in touch with an experienced broker. I constantly have me eyes on the market and I am in a position to not only guarantee the best rates of exchange against any competitor but also assist in timing your trade to maximise your return. There are contract options available that can be used to suit your individual needs, please do get in touch for further information by contacting me at dcj@currencies.co.uk.

Sterling exchange rates are struggling for direction, where next for the Pound? (Joseph Wright)

After beginning the week in downtrodden fashion, Sterling exchange rates today have posted some surprising gains once again with the GBP/EUR rate almost hitting 1.29, and GBP/USD trading as high as 1.4655.

I don’t think many would have expected these levels on Monday morning when Sterling was being heavily sold off. The bad start to the week was due to prominent ‘Brexit’ based polls suggesting that the ‘Brexiteers’ have been gaining support as of late, and this uncertainty weighed on the value of the Pound like it has done for much of this year.

Today’s boost was off the back of the latest Halifax HPI figures coming out better than expected, and they demonstrated an increase in house prices of 0.6% which boosted sentiment towards the Pound, driving up it’s value.

This positive sentiment surrounding the Pound today over-road a number of positives for the Euro recently. Firstly Eurozone GDP was recently revised upwards, and yesterday US Fed Reserve Chairlady gave a dovish sounding speech which boosted sentiment towards the Euro.

These examples just highlight the importance the upcoming EU Referendum has and how it’s driving GBP exchange rates at the moment. I expect the relationship between Sterling and the other major currencies to continue to be driven by EU voting (and betting) patterns.

Personally I’m expecting to see further headwinds in the lead up to the Referendum and I personally believe that the Pound is currently overvalued against both the Euro and the US Dollar, and I think we’ll see weaker levels for Sterling exchange rates on the day of the Referendum. 

If you have an upcoming currency requirement involving the Pound and would like to get a better exchange rate than what your bank will offer, feel free to contact me (Joseph) on jxw@currencies.co.uk or call in and ask for me on 01494 787 478. I’m here to help you ensure you make a well informed decision on when to make the transfer, and help you benefit from highly competitive exchange rates from one of the UK’s leading foreign currency brokerages.

Buying Euro and Dollar rates to be governed by non-farm payrolls (Joshua Privett)

The final day of the week will see severe volatility on buying Euro and Dollar rates around the midday period. This will be the release of US non-farm payrolls, which is a strong indicator of the health of the US economy.

The connection for this on GBP/USD rates is obvious, but GBP/EUR is a more subtle one. As USD/EUR is the most heavily traded currency pairing in the world, the general rule of thumb for anyone planning to engage in the currency markets is to note that whenever you have strength in one this tends to translate into weakness for the other currency, even against its secondary pairings.

Non-farms is such a volatile day that whole books are produced to advise amateurs on how to trade on the day for profit. Although I wouldn’t advise such speculation myself, the results vary wildly, which is what produces such strong movements on the markets since they are so difficult to predict.

Today the results will likely cause even more severe movements due to the fact these figures will be used to gauge whether the US decide to raise interest rates on June 15th.

The figures will be coming out at midday, and it is imperative to approach this release safely, as this data will be governing rates until the beginning of next week.

Those who are risk averse frankly may be wise to move this morning ahead of the data release. Particularly if you are buying Euros, given then last month’s non-farms were about 30,000 lower than expected, and Dollar weakness should translate into a more expensive Euro.

Dollar buyers may be in a position to wait, and may wish to utilize an automatic buy order in order to secure any sudden peaks which emerge in buying rates, even if they are only available for a few moments.

I strongly recommend that anyone with a buying Euro or Dollar requirement should contact me on 01494 787 478 and ask the reception team for Joshua in order to discuss the options open to you through the services of a currency exchange specialist in order to maximise your currency return.

I have never had an issue beating the rates of exchange offered elsewhere, and a brief conversation concerning your transfer could save your thousands. Whether you are buying now or in a few months, these current levels can also be fixed as they are ahead of a future purchase – essentially pre-booking your currency with a small deposit.

Sterling buyers can also get in contact, and I can explain the option open to anyone considering repatriating their foreign currency. jjp@currencies.co.uk

Buying Euro rates the focus for the Pound next week (Joshua Privett)

After a dip on Thursday the Pound limped towards the closing bell on Friday following poor growth figures for the UK economy, which saw buying Euro rates in particular to suffer the most.

The Bank holiday also presents a complicated entry into next week, with the UK and US (who will be enjoying Memorial Day) unable to trade whilst the Eurozone and the rest of the world have free reign.

The complication comes from the large volumes of data to be released from the Eurozone on Monday. This is a combination of growth, consumer confidence, and inflation figures from the EU as a whole as well as its member states.

Frankly, with such a wide look at the EU economy, and with the main players in the financial markets taken off the table, it is very difficult to second-guess the markets on Monday.

However, Tuesday may present some early opportunities to Euro buyers as we edge closer to June. Wherever we may find ourselves on Tuesday morning, the culmination of all the aforementionned Eurozone data, inflation figures for the whole area will be released.

The Eurozone cut their base interest rate to 0% this year off the back of poor inflation figures, which they have continued to struggle with. A repeat performance could see further opportunities for Euro buyers begin to emerge.

However, the window is a;ready presenting itself as a small one. Over the weekend the release of initial manufacturing figures for the UK economy during May has been brought forward to Wednesday from the following Monday.

Last month the Pound suffered heavily from poor manufacturing and industrial production figures – a result of poor weather and the Tata Steel crisis. The fact that this month all the available data has been tallied ahead of time suggests that there hasn’t been much production to take note of…again creating a concerning picture for the potential for the Pound against all currencies, not just for buying Euro rates, on Wednesday.

I strongly recommend that anyone with a buying Euro requirement in particular to contact me over the bank holiday weekend before Tuesday on jjp@currencies.co.uk to discuss your options and find the plan of action which suits your risk appetite and one aimed to maximise your currency return.

I have never had an issue beating the rates of exchange offered by my competitors, and these current buying levels can be fixed as they at any point on a particular day for a predetermined period set by you. You can essentially book ahead of time to buy your currency at a set rate.

With the Referendum coming up a brief conversation could save you thousands given the lerge swings in buying rates expected on the market place.

Sterling at the Mercy of EU Referendum Polls (Daniel Johnson)

Yesterday The pound gained strength against the majority of major currencies. This was due to impressive retail sales data, positive inflation figures and the remain camp gaining significant momentum in the polls for the EU referendum. GBP/EUR hit a twelve week high at 1.32. GBP/USD 1.47 and GBP/AUD 2.05.

A Daily Telegraph poll show that 55% of the UK population wish to stay, 42% wish to leave with the remainder undecided. What was surprising however was that the remain camp had support from the majority of over 65s. Their findings also revealed that those in the undecided camp were twice as likely to vote to remain in the EU than to leave.

The Institute of Fiscal studies also announced that if the UK were to leave the EU the UK would face an extra two years of austerity. GDP would decline and there would be additional borrowing costs which would result in losses of £20-40bn.

The polls will be a key factor as to Sterling market position up until the day of the vote 23rd June. It is important to note that Sterling crashed a few days before the Scottish referendum and the general election.

We have seen a slight decline today for Sterling against most currencies due to poor GDP figures which has been caused by businesses unwilling to trade due to the uncertainty created by a possible Brexit. GBP/CAD fell more significantly due to the increase in oil price.

If you have a currency requirement I would be happy to assist. I work for one of the top brokerages in the country and by doing so I can beat any competitors rate of exchange. I am willing to provide a free trading strategy to try and maximise your return. Fell free to drop me an e-mail at dcj@currencies.co.uk. Simply let me know the currency you are trading, time scale and a ball park figure as to the size of the trade. Thank you for reading my blog.