Tag Archives: pound

Scotland decides on NO – What impact has this had on the Pound and what may we see for Sterling in the coming weeks? (Daniel Wright)

Scotland decides to stay in the U.K

Following an extremely volatile few weeks for the Pound we finally have the decision from the Scottish referendum and Scotland has decided to stay with the United kingdom giving the pound a little strength against most major currencies.

We saw a huge turnout as far as voting goes (84%) which just goes to show how much this has captivated Scotland and divided opinion north of the border. Sterling has had a roller coaster ride against all major currencies over the past few weeks as polls have swung back and forth both ways after we had months of the markets almost assuming we would see a No vote. More importantly what this means for the Pound is that it has bought both economic and political certainty to the U.K for the time being, both of which should give the Pound a little strength in the coming days.

Investors and speculators alike hate uncertainty and the mere fact that the referendum had seemingly been in the balance has been holding Sterling back recently even with fairly solid economic data still being released almost on a daily basis. Sterling exchange rates have moved around three and a half cents from high to low against the Euro, four cents against the Dollar and ten cents against the Australian Dollar in the past two weeks as the markets try to second guess just what would happen with the vote.

Finally on Friday morning the decision came and I am pleased to say the U.K will indeed remain as one and now hopefully politicians and the Bank of England can fully concentrate on pushing the economy forward as a whole, rather than having to unravel an exceedingly complicated tangle that may have cast a grey cloud over the Pound and kept it weak for months to come.

If you find this site of use and would like assistance with any pending currency transfers involving either buying or indeed selling the Pound then feel free to contact me by email with a brief description of what you are looking to exchange and a contact number and I will be happy to get in touch. You can email me (Daniel Wright) directly on djw@currencies.co.uk

So what does this mean for me if I have currency to exchange?

Being an unprecedented situation, nobody really knows the exact impact this will have on Sterling but in my personal opinion I now feel that the Pound will kick on and gain a little strength over major currencies and heads can now turn towards if or indeed when interest rates may rise.

For those looking to sell foreign currency I would say now could be the time to secure your exchange rate. If you take the Euro as an example, it was only a few weeks ago that the European Central Bank not only cut interest rates but also indicated a few changes in Fiscal policy coming up.

Most notable of these is QE (Quantitative Easing). QE can generally weaken a currency once put into place and was one of the big reasons we saw both Sterling and the Dollar weaken a lot over the past few years. In my opinion once the dust has settled over the referendum the focus will come back on to Europe which still has huge problems to tackle and I feel the Euro could be in for a tough time of things.One must remember however we have crossed this bridge before and The Euro is a powerful beast. Only two years ago most analysts expected a rise through 1.30 when the Euro had even more problems than they do today and within a few months it was back below 1.20.

In essence the key thing you need to make sure you do is to keep in close contact with a currency broker no matter what your requirement in these particularly volatile times. Here at FCD we pride ourselves on not only the very best rates of exchange but also in being extremely proactive for our clients, making them aware of any spikes in their favour or drops against them.

We can’t let you know if we aren’t aware of what you are looking to do so make sure you email me (Daniel Wright) on djw@currencies.co.uk and I will be more than happy to help you personally. Sterling is trading at over a two year high against the Euro, a two week high against the Dollar and the highest we have seen against the Australian Dollar since March this year. If you would like to speak with one of our experienced and knowledgeable traders about any currency pairing then feel free to call us on 01494 787 478 or email me on djw@currencies.co.uk and I will be happy to call you personally.

Scotland says No which helps GBPEUR Exchange Rates (Tom Holian)

Sterling Euro exchange rates briefly hit their highest level in over two years on early Friday morning as the Scottish voted to stay part of the United Kingdom. The Pound immediately shot up to 1.28 for a very short time before ending the day nearer to 1.27.

It appears as though global investors and short term profit takers were eager to ‘fill their boots’ at 1.28 immediately after the announcement.

With the news having been released the currency markets appear at least for now to be a little more settled. The vote was 55/45 and personally I thought it would have been a wider difference.

Many people have been asking me recently if Scotland stays part of the UK then surely this would give rise to Sterling strength. My answer is yes but only for a short period of time as proved on Friday morning.

With such a large amount of people disillusioned at the result this could cause further instability in political terms which often then negatively impacts the currency involved. Therefore, don’t expect Sterling to rise too much just because the vote is now clear.

At 1pm tomorrow ECB President Mario Draghi is due to make a speech which will likely cover the recent decision to cut interest rates and introduce further QE for the Eurozone. Any negative comments during the speech could see Sterling Euro exchange rates pick up later in the afternoon.

If you have a currency transfer 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

 

 

 

Calm before the storm? (Mike Vaughan)

Sterling reached its highest level against the single currency since August 2012 reaching a peak of 1.273 this afternoon – is this the calm before the storm? With the Scottish independence vote well under-way the market is eagerly awaiting the result of the vote expected for release early Friday morning (expected around 07:00). A yes vote is likely to be catastrophic for the pound with some analysts suggesting as much as a 10% drop in value for sterling, in contrast a no vote will bring a sigh of relief to many and I would look for the pound to fund support in excess of 1% across the major currencies.

Should you wish to remove the uncertainty our trading lines will be open for another few hours and there is still time to help. Email Mike at mgv@currencies.co.uk

As against the Euro, sterling has continued its strong rally against the Australian dollar having shifted 10 cents in last 10 days (5.8%). This makes a difference of AUD 20,000 on a £200k transfer.

Data from Australia has been relatively light this week highlighting how dominant sterling has been and just how the Scottish independence vote is influencing the value of the pound. With voting having started this morning and the results scheduled for 07:30 tomorrow morning, the next 24 hours are likely to be extremely volatile. I for one believe the ‘no’ camp will prevail and this is bound to lend further support to sterling and I would look for a shift towards 1.85.

Overnight the RBA bulletin gave little insight as to future monetary policy but I still believe the RBA will be uncomfortable with the value of the dollar and this 10 cent shift will have been a welcome move

To get assistance with your foreign exchange and to get the best deal on the market email Mike for more information at mgv@currencies.co.uk

Market volatility set to continue in the run up to the Scottish Independence vote on the 18th (Mike Vaughan)

Sterling exchange rates have found some support today as the latest poll for the Scottish independence vote suggested the vote for no was creeping ahead of the yes camp. This volatility is set to continue in the run up to the vote on the 18th.

With so much focus on this vote it is easy to forget the important data releases that are still scheduled. Tomorrow’s data is focused mainly on the Euro Zone and US with employment figures and industrial production data released by Eurostat at 10:00 tomorrow morning, followed by the important US retail sales data state side at 13:30.

Retails sales data is expected to show a good improvement and should in theory lend support to the greenback. It is important to keep an eye on all data sets as it is very easy to simply focus on one area. Of course the Scottish referendum vote is the main driver for sterling currently but should you like an overview of other important releases and the potential impact they might have on your currency transfer then please email Mike at mgv@currencies.co.uk

AUD

Following the pounds losses earlier this week (due to Sundays poll suggesting the ‘yes’ vote was taking the lead in the Scottish referendum) the pound has rebounded five cents or nearly 3% since Monday. The move came about as the latest opinion poll puts the ‘no’ vote at 53%  - for me the vote is likely to be a no and it is this that I believe will lend more support to sterling and push levels back though the 1.80 level. For this reasons should you be selling AUD then current rates should still look like an opportunity.

Overnight the Australian unemployment data fell to 6.1% from 6.4% but did little to affect the AUD exchange rate suggesting the current market is dominated by the movement of sterling. This volatility is set to continue for the next week until the vote passes on the 18th.

To get more information on the currency service we provide please contact the office on 01494 787478. To help you make the most of your currency it is important you get as much information as possible. Our market knowledge is available for any client and we are happy to assist with any bank to bank money exchange not matter how big or small. For more information please email Mike mgv@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 falls as the Pound falls out of fashion due to Scottish referendum polls easing closer – Weakness for Sterling exchange rates (Daniel Wright)

A quick update from me to let you know that Sterling has been falling for the past 24 hours, following news from the polls over in Scotland that the referendum is currently a lot closer than had been thought. The reason this has led to the Pound dropping is because it has now cast a grey cloud over the U.K both in terms of economic and political uncertainty – Both factors that can have quite an impact on the strength of a particular currency.

With the referendum due on the 18th September we may we be set for an extremely volatile few weeks for Sterling so it is imperative that if you have the requirement to either buy or sell foreign currency in the coming weeks or indeed months then you should let me know exactly what your need will be. We have many tools here designed to assist you with getting the most out of your money ranging from being your eyes and ears on the market and informing you of movements either in your favour or against you, to forward contracts, limits orders and stop losses.

GBPEUR

Sterling is actually trading almost 10% higher now against the Euro than it had been last summer (see graph) so if you are in the process of buying a property in Europe even with the drop exchange rates are still extremely favourable. We have a couple of key economic data releases still to come out this week with the Bank of England interest rate decision tomorrow at 12:00pm, the European Central Bank interest rate decision at 12:45pm and the ECB press conference from 13:30pm onwards. The ECB press conference can actually lead to an extremely volatile period for the Euro, and the main focus will be on whether or not they do decide to take any action with QE (Quantitative Easing).

Even the mere mention of it may weaken the Euro slightly but of course beware that if they rule it out in the short term then the Euro may strengthen further. Finally on Friday at 13:30pm we have Non-Farm Payroll data over in America. This release can have an effect on all major currencies as it can change global attitude to risk so no matter what your need it is well worth having an eye on the market on Friday afternoon.

If you have a requirement in the future but you do not yet have the full availability of funds you can book out a forward contract. This is where you can book a rate out for up to a year in advance with just a small deposit, removing the risk of the currency market making your purchase any more expensive in the future. This is ideal if you are in the process of buying a property overseas as you can know exactly how much the property is going to cost you today and eliminate the risk of the Pound dropping away again and missing out on this great opportunity. I look forward to speaking with you if you have any questions or queries or you would like to book out a rate of exchange.

IF YOU ARE RECEIVING THESE REPORTS AND FIND THEM OF USE THEN WHY NOT CLICK HERE TO REGISTER FOR A FREE, NO OBLIGATION TRADING FACILITY TO SEE JUST HOW MUCH YOU CAN SAVE OVER YOUR BANK AND CURRENT BROKER. IT TAKES JUST TWO MINUTES TO COMPLETE AND MAY SAVE YOU £1000s!

Pound at lowest level against the US dollar in six months (Mike Vaughan)

Sterling has had a poor day against most majors but notably reaching its lowest level against the greenback since March and bringing the dollars gains against the pound to nearly 4% since July. The movements today appear to have come about following  after a poll by YouGov indicated rising support for the pro-Scottish independence “Yes” campaign.

The poll indicated the lead held by the “No” campaign to reject independence had narrowed to six points from 22 points since the beginning of August. As my colleague Colm mentioned below, the uncertainty this has created for investors has caused the sell off for the pound creating a 1 cent loss against the Euro and US dollar, this may well be a short term reaction, and for me has created some good sell prices for the Euro.

The rest of the week remains busy with the focus tomorrow on Euro Zone retail sales at 10:00 (expected to show a sharp decline), the Bank of Canada interest rate decision and accompanying statement at 15:00 followed by the US FED beige book at 19:00

Looking at Thursday and this is set to be the busiest day of the week with the Bank of England and European Central Bank releasing their interest rate decisions at 12:00 and 12:45 respectively. For me both central banks will keep the base rate on hold but the key area to focus on will be Mario Draghi’s press conference at 13:30. With inflation figures having fallen to their lowest in five years, this is putting more pressure on the Euro Zone to act against deflationary pressures and it is this pressure that could result in the Euro weakening tomorrow afternoon.

Should you have a foreign exchange transaction to arrange and you would like more information on the currency service we provide then please email Mike at mgv@currencies.co.uk

 

 

 

Are you placing too high an expectation on sterling exchange rates rising?

So today the unexpected happened and two members of the MPC (Monetary Policy Committee) Martin Weale and Ian McCafferty both voted to raise interest rates citing improvements in the economy and expectations wage growth could soon rise in line with inflation which has been falling. The effects were immediate and sterling spiked up reaching a peak of 1.2546 (GBPEUR) and 1.6679 (GBUSD) offering relief to anyone buying a foreign currency with the pound. The gains were quickly undone however with sterling finishing the day only about 0.1% above the opening on most pairings.

I think this highlights the danger in banking on big improvements in sterling exchange rates in the future. Here we have had the first split vote since 2011 at 7-2 and the effects were rather timid and failed to help lift sterling to the lofty heights we enjoyed a few weeks ago. I think if you need to buy a foreign currency with sterling making some plans now is a wise move since it is difficult to see where any further major boost will emanate from.

Tomorrow are Retail figures plus Government Borrowing data which may all serve to help lift the pound. Both releases were actually negative for sterling last month so if you are in a position to be holding sterling waiting to buy another currency, moving sooner might be the best course of action. To help catch the very best rates we offer STOP LOSS and LIMIT orders which trigger when certain levels are hit. This is often the only way to catch the best rates since the market can move so quickly!

For more information on what is the best approach to your currency situation please contact me Jonathan on jmw@currencies.co.uk. I have been working as a currency broker for 5 years and have lots of experience in the planning and execution of international payments. I look forward to hearing from you.

Jonathan

 

Sterling falls following UK inflation data (Mike Vaughan)

Sterling has taken another hit today against most major currencies following a fall in the headline inflation rate and taking pressure of the Bank of England to raise interest rates. As a result the pound fell back below 1.25 against the Euro and is now trading at its lowest level against the US dollar since April.

This data comes ahead of tomorrow’s key Bank of England minutes released at 09:30 and another release that may cause the value of sterling to fall. This report will indicate as to how the nine members of the monetary policy committee voted in relation to interest rates and will also give potential clues as to what other monetary policies the central bank may have in store. For me it is likely that the split will have been 9-0 in favour of keeping the UK’s base rate at 0.5% but any surprise results and the pound will be set for another volatile day tomorrow.

Will the pound continue to fall?

For me the pound is likely to remain on the back foot against the US dollar, however I still feel with the continuing threat of deflation in the Euro Zone, the pound will find support and return back to the levels seen in July – for this reason I would suggest the current moves represent a good opportunity if you are selling Euros.

Looking at data to watch out for and tomorrow will also see the release of euro zone construction figures at 10:00 and the FOMC minutes at 19:00. This is the US version of the Bank of England minutes and can cause a shift in dollar exchange rates dependent on the tone of the report.

To get more information regarding the currency service we provide please contact the office on +44 (0)1494 787474 or email Mike at mgv@currencies.co.uk

Pound Sterling Forecast – Economic data out the first few days this week and how it may move exchange rates (Daniel Wright)

A very slow start to the week for Sterling today with very little economic data or news for the markets to move off.

This will more than likely be the calm before the storm this week though as there is plenty of data for investors and speculators alike to get their teeth into which will no doubt cause quite a lot of volatility for most major currencies.

Tonight - Overnight we see the RBA (Reserve Bank of Australia) meeting minutes and the RBNZ (Reserve Bank of New Zealand) inflation expectations, out at 02:30am and 04:00am respecively. RBA Governor Stevens has seemingly turned a corner lately with his comments on the strength of the Australian Dollar and appears to be a little happier with the way things are going, leading to the Australian Dollar gaining some strength back against the Pound and knocking the GBP/AUD rate back below 1.80. Stevens is also due to speak on 00:30 Tuesday night as well.

Tomorrow – Tomorrow morning we see a key inflation release from the U.K which could easily lead to a bumpy ride for Sterling followers during the course of tomorrow morning. Inflation had beejn at 1.9% which is just about below the Government target of 2% so any minor alterations to this, especailly to the upside could give the Pound a morning boost, as one way to lower would be to raise interest rates, so a figure of 2% or above may lead to a little speculation of a rate hike coming a little closer. Of course, comments from the Governor of the Bank of England last week may well cut this potential out.

Later in the day it is the turn of the States for their inflation data, interstingly also expected to come out at 1.9% so if you have an interest in the Dollar be sure to keep a watchful eye on the market shortly after 13:30pm – Or why not email me on djw@currencies.co.uk and I can monitor things on your behalf.

Wednesday – Wednesday morning we have the Bank of  England minutes from the last BOE interest rate decision. No major expectations from this one however it does really have the potential to throw up a surprise or two and news that any of the 9 members of the Bank of England now are voting in favour of an interest rate hike may give also Sterling a shift up in the right direction.

Later in the evening we have the FOMC (Federal Open Market Commitee) minutes, again very similar to the BOE minutes seen a little earlier on this will show how the Fed voted in terms of rate movements and what they discussed at the last interest rate decision, last time around we saw one memebr of the Fed vote in favour of a rate hike which did give the Dollar a little boost.

If you have a currency transfer to carry out and you want to achieve the very best rates of exchange either for your company or a personal transaction, along with highly valuable market knowledge then why not contact me (Daniel Wright) by email on djw@currencies.co.uk with a brief description of what you are looking to do and a contact number and I will be more than happy to assist you personally.

Even if you currently use another broker you may be surprised at how much you can save by getting in touch as a small improvement on an exchange rate can make a big difference to you.

I look forward to hearing from you.

 

 

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