The sharp fall in the pounds value since the Brexit vote in June and continued political instability is a worry for my clients as I believe further falls are on the horizon. Now that we are only 6 weeks away from UK Prime Minister Theresa May Brexit deadline clients purchasing a foreign currency within the next 6 months should seriously start to consider their options.
One way to minimise your risk is to purchase your currency up front by using a forward contract. Forward contracts allow you to freeze a rate now and you can pay later for it. This contract is rarely offered by UK banks and is an advantage of using the brokerage I work for. For more information in regards to a forward contract email me directly and state ‘Forward Contract’ firstname.lastname@example.org.
Economic data released this week is another reason why people should consider purchasing currency upfront. Retails sales numbers plummeted Friday morning to -0.3%, which was 1.2% lower than forecasters had predicted. Furthermore wage growth also fell earlier in the week to 2.6% from 2.7%.
Therefore my theory behind it is that if inflation continues to rise due to oil prices, items are going to become more expensive which in turn means retail sales numbers will continue to fall as wage growth dwindles. All in all this would be another reason why the pound would continue to lose value and something the Bank of England will need to monitor closely.
Events to look out for this week are Gross Domestic Product numbers released Wednesday morning at 9.30am and any Brexit related news in particular news from the House of Lords. If you would like to be kept up to date with market information that will impact your upcoming transfer get in touch.
The currency company I work for enables me to buy and sell pounds at rates better than other brokerages and high street banks. If you are buying or selling pounds this year feel free to send me the currency pair you are trading (GBPUSD, GBPEUR, GBPCHF etc) the reason for your trade (company invoice, buying a property) and I will email you with my forecast for the currency pair and the process of using our company email@example.com.
Enjoy the rest of your weekend and I look forward to speaking with you Monday morning.