Tag Archives: GBPUSD forecast

Why is the Pound losing value at the moment, and will it continue? (Joseph Wright)

Brexit jitters are continuing to weigh on the Pounds value, with the currency losing a substantial amount of value over the past week across the board of major currency pairs.

Currency markets were already weary of the Pounds future price movements as we await the outcome of the Supreme Courts impending decision on whether or no the UK Government requires parliamentary approval before beginning the Brexit.

These fears were exacerbated over the past weekend as a much talked about interview offered the marketplace an insight into the UK PM’s plans for the Brexit. UK Prime Minister, Theresa May alluded to prioritising the control of immigration, as opposed to focusing on retaining the UK’s access to the single market.

Moreover, May commented that the UK cannot keep ‘bits’ of EU membership and this comment has fueled the fire of bearishness towards the Pound at the moment.

It’s for these reasons that we’ve seen the Pound soften over the week, and the sell-off accelerated this afternoon after May announced that she will be giving another major speech on her Brexit plans on Tuesday of next week.

I personally think that the Supreme Court decision will have been announced by then, so there’s a possibility we could see a lot of volatility between GBP exchange rates between now and then.

Until then, I think that anyone with a currency exchange requirement involving the Pound should pay close attention to the Supreme Court decision. The likelihood is that if the Government is successful in their appeal we can expect to see the Pound fall further, as the Government plans on invoking Article 50 at the end of March and there polices generally lean towards a ‘Hard Brexit’.

On the other hand if they’re unsuccessful the general consensus is that the Pound could get a lift. Feel free to get in touch if you wish to be kept up to date with the outcome of the Supreme Court’s decision, as of yet we have no definitive time as to when this announcement will be made.

If you are planning to make a currency exchange involving the Pound and another foreign currency, it’s well worth your time getting 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 speak to me directly on the phone by calling 01494 787 478 and asking reception to speak with Joe.

Sterling continues to fall following Theresa May’s comments (Daniel Johnson)

Sterling has a rough start to the week

Following Theresa May’s comments this weekend, where she hinted toward a hard Brexit sterling has fallen heavily with GBP/EUR sitting in the 1.14s and GBP/USD in the 1.21s.  She stated during a Sky News interview that she would consider giving up free trade for control over immigration.

I think more important however will be the ruling in regards to the supreme court judgement on whether parliament will get to vote on the triggering of article 50. If parliament do get the vote it is probable there will be a soft brexit, with temporary trade deals in place while negotiations take place. This eventuality should cause the pound to rise.

If parliament do not get the vote a hard brexit becomes the probable outcome and this could result in trade negotiations being troublesome and elongated. Sir Ivan Rogers, the UK ambassador to the EU recently resigned  due to what he considers to be unrealistic estimations on how long brexit will take. The current target for a full exit from the EU is two years, Sir Ivan thinks it will be nearer ten.

I would expect the the supreme court ruling to come through between the 12th-17th January, keep your eyes on developments on the case as this could have major implications on the value of the pound.

UK data releases that could effect Sterling short term

Tomorrow will see the release of UK manufacturing data where I would expect to see an improvement which could cause some respite for the pound. GDP figures are also released on Wednesday and I would again expect a slight improvement. Please be aware however that any news from the supreme court judgement is likely to outweigh these data releases.

If you have a currency requirement I will happily assist. If you let me know the details of your trade I will provide a comparison against your current provider and also formulate a trading strategy to suit your individual needs. You can trade in safety knowing you are dealing with a broker from Foreign Currency Direct PLC, a company trading for over sixteen years with the highest credit rating and one which is also registered with the FCA. Please do get in touch by e-mailing me at dcj@currencies.co.uk. Thank you for reading our blogs.

Buying Euro and Dollar rates largely stable despite record 14 year highs in retail sales figures (Joshua Privett)

Buying Euro rates are up at some new two month highs today following strong retail sales figures in the UK economy. Luckily for Euro sellers this rally on the Pound was muted thanks to comments over in America.

A mixture of cold weather, worries about further price rises due to the Pound’s relatively weak buying power for foreign goods, and potentially some very prudent planning for the Christmas period, has seen the largest single increase in UK retail sales figures in 14 years.

Euro and Dollar buyers alike can lay their thanks squarely at the feet of this news this morning. However, the gains even before the intervention of news from the US were lacklustre compared to how markets would normally react to such news. 1.17 was only briefly reached on GBP/EUR and such staggeringly positive news regarding such a large sector of the UK economy normally translates into sustained gains measured in whole cents.

We have become used to markets operating with this form of tunnel vision towards large political events such as the Brexit over economic data, however, the next big market mover is expected next Wednesday with the Autumn Statement in the UK.

As stated it was events in the US which managed to stop what should have been a larger rally for the Pound against the Euro.

Events in the US tend to have a direct impact on the Euro’s value, as USD/EUR is the most heavily traded currency pairing in the world, so any negative news in one currency tends to translate into the opposite effect in the other.

In this instance, hints from the FED that the US would not be raising rates at their latest December meeting allowed the Euro to benefit from lowered confidence in the Dollar.

Given that even positive news is not registering heavily on the currency markets for the Pound, and with the potential for the Autumn Statement to reflect the sudden and heavy borrowing activity announced by Theresa May’s new government, Euro and Dollar buyers may be wise to seize the recent gains made available with the surprise impact of the Trump Presidency before this is likely tested next week.

I strongly recommend that if you have a Dollar or Euro buying or selling requirement you should contact me on jjp@currencies.co.uk whilst markets are largely inactive overnight to discuss a strategy for your transfer and the options open to you to secure any tempting levels which emerge immediately.

I have never had an issue beating the rates of exchang on offer elsewhere, and these current buying levels can be fixed in place for anyone planning a foreign currency purchase later in the year and wish to secure these current levels ahead of what is expected to be a tumultous period.

You can also fill out the form below and I will respond to you as soon as I am able.

Buying Euro and Dollar rates showing tentative trends ahead of US election (Joshua Privett)

Clinton’s second declaration of innocence by the FBI has allowed buying Euro rates to remain relatively steady today, whilst buying Dollar rates have fallen heavily.

Now that the election is fast approaching, it would be best to cover the relationship between events in the US and the currency markets as a whole, not just with the direct impact on GBP/USD rates of exchange.

USD/EUR is the most heavily traded currency pairing in the world given the amount of currency in circulation for both. As a result, a general rule of thumb has been applied that weakness in one currency tends to translate into strength in the other. This is because when investors take their capital out of the Dollar, for example, the Euro will catch a larger percentage of those panicked investors and gain value through increased demand.

The USD strengthened today following Clinton’s exoneration by the FBI. Markets have made no secret that they would prefer a steady head of continuation in the top office in the World’s largest economy, and Trump’s recent gains in the polls were what allowed GBP/USD to reach 1.25 once more recently.

As such, the Euros value remained under pressure throughout the day, with buying Euro rates at inter-bank level managing to remain above 1.12 for most of the day.

Moving forward, much of the rates on GBP/EUR, GBP/USD and GBP/AUD will be governed by the polls which are only just starting to reflect the weekend’s news. Any surprises before tomorrow could curtail this trend, but based on the preliminary gains made for Hillary Clinton, USD buyers may be wise to move sooner rather than later, and Euro buyers may be seeing further tentative gains later on in the day.

In this current market it is imperative to be in a position to move quickly should any tempting rates of exchange occur, as the hyper-sensitivity which has been demonstrated on numerous occasions means that opportunities are rarely around for long.

Furthermore, with so much of the current rates for buying and selling Euros and Dollars built into the political atmosphere, there is an even greater chance of sudden changes in the currency markets, so a premium will be put on being a well-informed purchaser.

I offer a service to my customers to provide just this. There are options tailored to protect yourself from any adverse currency movements and more positively to make sure any tempting movements are seized immediately. You can contact me overnight whilst markets are relatively quiet on jjp@currencies.co.uk to discuss a strategy for your transfer aimed at maximizing your return and safeguarding your transfer from any surprises which have become a common feature in these markets since the Brexit vote.

As a final note I have never had an issue beating the rates of exchange on offer elsewhere, and these current buying levels can be fixed in place for anyone planning a Euro or Dollar purchase or sale within the next few months and wish to avoid all risk all together.

You can also fill out the form below and I will be in contact as soon as I am able.#

 

Will the pound rise or fall on the US election?

Sterling has risen as investors get excited over the potential for the UK to avoid a hard Brexit. Investors have become very fearful of the full implications of a hard Brexit. Essentially access to the single market is a key factor in the strength and attractiveness of the UK economy. The rates for the pound have now increased as this prospect becomes shaky but will it last? If you have a transfer to make in the future there is all the important US election next week and it could easily be the end of this current surge in sterling’s value.

The High Court have ruled that the UK government will have to seek parliamentary approval to invoke Article 50 the legal mechanism to trigger Brexit. The court ruled that Theresa May must go to the House of Commons and Lords to get a rubber stamp of her plans. This means that whilst Brexit is still likely to happen the Government might be forced to water down the proposals. All in what this means is much more uncertainty for the pound!

Next week is the US election and I expect the pound will fall further eroding these excellent gains. Typically a currency will strengthen once an election is over as you get certainty of the situation. In this case the US dollar may rise and this will weaken the pound. Sterling’s most heavily traded currency pairing is GBPUSD so if GBPUSD drops lows because the US dollar is rising it will weigh the pound down against other currencies.

This market is still very tough to call but sterling is not out of the woods with the latest UK political developments. If you are considering a currency transfer in the future you may benefit from the experience of a currency specialist who can keep you up to date with the market and all of your options. I have worked here for almost ten years and lent my comments and insight to newpapers and also BBC News.

For more information at no cost or obligation please speak to me Jonathan Watson by emailing jmw@currencies.co.uk or filling in the form below.

Sterling is on track for its worst month since June, will the decline continue? (Joseph Wright)

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 jxw@currencies.co.uk  and I will be more than happy to contact you personally to discuss the various options we have available to you.

Will the pound fall as we approach the US Election?

As we get closer and closer to the US Election there remains a real possibility the pound could come under pressure. This is because investors will be looking to move money into the higher yielding US dollar which will see the pound weaken. GBPUSD is the most heavily traded currency pair for the pound so big shifts on GBPUSD will impact sterling against other currency pairs. The next few weeks will I believe see increased volatility on exchange rates owing to the US election, thankfully there are options available which we can utilise to help minimise your exposure to these undoubtedly turbulent times!

The pound has plunged into new depths in October as the expectations of a hard Brexit increase. This last week however has seen the pound find a little support with the good news on UK GDP (Gross Domestic Product) yesterday. I think the pound is going to continue to struggle in this environment of political uncertainty as investors avoid taking big positions. News that the legal challenge to invoking Article 50 has failed we have seen the pound slip a little in today’s sessions.

Sterling may push lower further next month with the US Election likely to take attention and funds. Investors are likely to wish to capitalise on a stronger US dollar once the election outcome is known. Assuming a Clinton victory this should see the US dollar rise and sterling fall. Investors have been betting the US will raise interest rates and once the election is over investors will surely be looking to when the Fed will next hike. A Trump victory could have all sorts of repercussions for the US dollar and the pound which will affect the pound against all currencies.

A Limit order allows you buy at a high rate is levels improve. A Stop / Loss order allows you to lock in a lower level should the rates fall. These simple tools can be used by investors to manage their risk and best / worst case scenarios.

I work as a specialist currency broker and can help with any transfers you will need in the future. Please contact me Jonathan on jmw@currencies.co.uk to learn more about our service and the latest news to keep up to date with.

Buying Euro and Dollar rates set for further boost this morning (Joshua Privett)

Yesterday saw heavy drops and rises on GBP/EUR, GBP/USD and GBP/AUD, with buying Euro and Dollar rates impacted by the volatility caused by swinging commodity prices, lower than expected retail sales in the UK, alongside the highly anticipated European Central Bank interest rate decision and monetary policy statement.

There was very little change to the status quo in all three of the above market events, yet GBP/EUR and GBP/AUD in particular were swinging wildly to the news. This further highlights just how hypersensitive this current market is.

Nothing out over the past few days were suggestive of long-term trends, however, in the short-term some key indicators have been given.

Rates have been rising marginally following the flash crash which I’m sure all readers of this website would have noted 12 days ago. Given that this was an artificial fall, there is still room for rates to improve back to a level where the Pound’s value has more justification.

The further boost needed may come from UK public sector net borrowing figures this morning.

Despite all the fan-fare that in the wake of the Brexit vote the Government has abandoned its target to cut the deficit, public sector net borrowing figures are expected to fall during the month of September, which should further dispel the current narrative of ‘crisis’ when looking at the UK economy.

The news will be coming out at 9:30 am UK time, however, as early as the afternoon the Pound is likely to be coming under further pressure.

The phenomenon of profit-taking, which has been covered extensively by this website, has regularly and markedly impacted the Pound’s value heading into the weekend.

Traders at high street institutions are the actors who move the volumes large enough to affect the average buying rates have to choose a stable currency with which to allocate their currency into for the weekend to protect its value whilst they are away from their desks. For obvious reasons Sterling is very low on this list of stable currencies, and as such the total lack of demand for the Pound during this period sees its value cascade downwards.

As such, if you have a short-term requirement for buying Euros or Dollars, a window of opportunity is expected today and I am in a position to detail the options open to you to seize any tempting opportunities which emerge.

I recommend contacting me on 01494 787 478, and the reception team will put you through to Joshua if you ask for me directly. We can discuss a strategy aimed at maximizing your currency return.

Alternatively, you can reach me on jjp@currencies.co.uk if you requirement is slightly more longer term, but in this current market it is clearly prudent to plan ahead of time.

You can also fill out the form below and I will contact you as soon as I am able to.

 

Will the Pound continue to fall this year, and what to look out for tomorrow (Joseph Wright)

It’s been an interesting couple of days for Sterling exchange rates as the currency has been undecided on its general direction of movement.

At the time of writing the Pound is actually down on the day against all major currency pairs such as the US Dollar, Euro and the Australian Dollar. Although throughout today’s trading session Sterling has spiked upward at times, offering clients the chance to book their trades whilst the exchange rate was quite considerably higher than it’s lowest point throughout the day.

The reason for the buoyancy towards the Pound this morning and at times throughout the day, is most likely down to the better than expected inflation figures yesterday which demonstrated a 1% gain in inflation over the past year, which is currently a healthy level although that could change if it gets out of hand due to the rapidly weakening Pound.

It’s on days like today whereby our clients benefit from the service we provide, as the monetary difference between converting currency at the bottom of the day’s exchange rate range, compared with the top of the day’s range can be huge when converting large amounts of currency.

We’re already in a position to improve substantially on the exchange rates offered by high street banks, but with our proactive service we’re able to often maximize our clients exchanges to their benefit.

There are a number of analysts from major institutions offering forecasts for the GBP/EUR pair of parity, which means they’re expecting the Pound to fall another 9% or so between now and in many cases, the end of next year. HSBC are perhaps the most prominent entity to make such a claim, so feel free to get in touch if you wish to discuss your options regarding this potential fall as there are methods of protecting yourself against such a fall.

Tomorrow is expected to be a busy day for exchange rates due to the raft of economic data releases, with the European Central Bank’s Interest Rate Decision likely to be the most prominent. Should there be a change to the 0% figure expected tomorrow by analysts, I would expect to see some substantial movement within exchange rates involving the Euro as well as many other pairs who’s performance is interconnected with the ECB’s monetary policy.

The ECB’s release is at 12.45pm which gives you plenty of time to get in touch beforehand should you wish. You can call me (Joseph) directly on 01494 787 478 if you wish to regarding the news release and our service. 

If you are planning to make a currency exchange involving the Pound, it’s worth your time getting 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.

 

Buying Euro and Dollar rates expected for calmer Friday than last week (Joshua Privett)

Buying Euro and Dollar rates of exchange have entered Friday in a much more stable position compared to the sheer chaos caused in the early hours of last week with the flash crash in Asian markets.

That being said, the Pound is slightly down to begin the day against all major currencies, which is suggestive that speculation is still the dominant force governing the marketplace in this hypersensitive environment.

If you were not aware of the flash crash last week then your currency requirement must have only some up in the last few days. The Pound was battered by either a gigantic erroneous trade, or a severe miscalculation in automatic trading algorithms, in the early hours of Asian trading last Friday which caused a heavy deterioration on GBP/EUR, GBP/USD and GBP/AUD.

This was an artificially forced drop which the Bank of England are still investigating and markets have since recovered. However there was still a net loss, and such a crash was only possible due to the heightened anxiety surrounding the Pound since the announcement of a hard deadline from Theresa May for Article 50 by March 2017.

This anxiety has since been heightened by the likes of EU President Donald Tusk stating it’s either ‘Hard Brexit or no Brexit’ with both sides making markets nervous that no gentle exit will be able to be found.

To coincide with all of this, we are now entering another Friday and the abnormal trading patterns associated with this. 

Each Friday almost like clockwork since the Referendum, the Pound has had a difficult time in the afternoon heading into the weekend due to profit-taking in the market place undercutting its value.

Whilst this was eclipsed by the added mania last week, this is still a persistent issue for Euro and Dollar buyers, likely more so with the currently panicked financial world.

Each Friday trader’s at high street institutions have to allocate their funds into a stable currency whilst they are away from their desks for the weekend in order to protect their capital. For obvious reasons the Pound is very low on this list of stable currencies which are in high demand during this period. As such the Pound is sold off during this period and its value falls off a cliff.

I strongly recommend that if you have a GBP/EUR, GBP/USD, or GBP/AUD requirement in the short-term to contact me this morning before the volatile period begins in earnest this afternoon to discuss how to protect an upcoming transfer from any adverse movements, and receive a competitive quote for your transfer.

I have never had an issue beating the rates of exchange on offer elsewhere, as such a brief conversation could save you thousands on an upcoming transfer. You can reach me directly by calling 01494 787 478 and asking the reception team for Joshua.

Euro and Dollar sellers can also get in contact to discuss the options open to you to seize any peaks which emerge in the time-frame you have to make your transfer in order to maximise your sterling return. As my argument above suggests, if I was in your position I would not be looking to move straight away.

You can also contact me via email on jjp@currencies.co.uk or fill out the form below and I will be in contact as soon as I am able to: