Tag Archives: sterling forecast

GBP/EUR, GBP/USD and GBP/AUD begin falling ahead of final month in 2015 (Joshua Privett)

GBP/EUR, GBP/USD and GBP/AUD all produced a negative trend heading into the weekend, with anyone hoping to use Sterling as a purchasing currency seeing their exchange getting slightly more expensive.

This was mainly due to underwhelming GDP figures released for the British economy summarising growth during the third quarter of this year.

Growth for the year had already been revised downwards during October and it seemed that November did nothing to turn this around, causing confidence in Sterling to dip ahead of the final trading day of the month on Monday.

There isn’t any data expected on Monday that could reverse this currently negative trend, so Sterling holders should expect similar falls produced on Friday which saw 1.41 hit on GBP/EUR, and 1.50 almost being breached on GBP/USD.

Another factor which has become a common feature since August this year has been irregular market movements on the last day of the month as ‘profit-taking’ occurs.

Currency traders at banks and other large financial groups who move hundreds of millions in capital speculating on the markets on daily basis are the main drivers of currency rates.

Common practice is for them to consolidate their profit at the end of the month and reform their positions and strategies ahead of the coming four weeks.

Traders would have already noticed that last time Sterling reached these highs on the markets in August, they gradually declined back by as much as 10 cents on some currency pairings such as GBP/EUR by the start of October. So it is unlikely they will choose to store their profits in Pounds.

Better performing currencies such as the US Dollar will likely be selected, particularly with an interest rate rise in the US expected at the start of December. Capital outflow to the Dollar will likely exaggerate this currently negative trend on Sterling moving into the start of December on Tuesday, with GBP/EUR likely being hit the hardest as it will be difficult for GBP/USD to break the resistance level at 1.50.

I strongly recommend that anyone hoping to use Sterling as a purchasing currency, particularly on GBP/EUR should contact me on jjp@currencies.co.uk to discuss a strategy for your transfer in order to maximise the return on your currency of choice. These currently high levels can be fixed to avoid any harmful movements before 2016 comes around to make your purchase more expensive.

Those looking to purchase Sterling can also do the same, and I will explain the various options open to you to ride any movements in your favour to their peak within the time-period you have to complete your transfer. These include rate-alerts to let you know when your desired rate becomes available. 01494 787 478

UK Recovery Remains Firmly on Track! (Matthew Vassallo)

It’s been another positive week for Sterling exchange rates, with GBP/EUR spiking back towards the highs we saw in the summer. The Pound received a boost following investor concerns that the European Central Bank (ECB) is likely to increase its current Quantitative Easing (QE) programme in December. This news caused the EUR to weaken, which helped drive Sterling’s value up its current standing.

The good feeling was intensified yesterday following the latest Autumn Statement, where both UK Prime Minister David Cameron and Chancellor George Osborne were very bullish regarding the UK economic recovery. They felt we remained firmly on track for the growth targets they outlined and the UK remains the fastest growing economy inside the EU. This news helped to solidify the Pound’s position around the current levels and despite my feeling that we will not see the near 9 years highs of the summer breached, I do anticipate the Pound to find some protection around 1.40 in the short-term.

GBP/USD rates have remained fairly docile of late with the green-back threatening to make a decisive move under 1.50, only for GBP to find protection and move away from this key resistance level. It is now widely anticipated that the US FED will raise interest rates in December and I believe this has now been factored into the current exchange rates. We may see the USD gain further strength as and when this hike is confirmed but I don’t believe we will see a major spike, due to this reason. If for any reason we do not see a rate rise expect the USD to weaken against Sterling.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me directly on mtv@currencies.co.uk

Will the pound keep rising next week?

The last few weeks have seen a real rollercoaster on exchange rates with lots of uncertainty principally from the Federal Reserve and the European Central Bank as to whether these bodies will raise interest rates (the Fed) or launch more QE (the ECB). The foreign exchange market is a very fickle beat and unfortunately for anyone trying to second  guess the market to well time their buying or selling of currency,  there are no quick answers or guarantees. Exchange rate movements are a response to investor demand for said currency, with moves hinging on many wide ranging factors. Currently the pound is enjoying strength since the UK economy has made improvements versus many of its counterparts like for example the Eurozone. After many years of low economic growth and high unemployment the UK is now creating jobs and growing at a slow but reasonably consistent level. This has led to sterling rising as it becomes more and more likely the UK will raise its base rate.

The UK economy is on the right track but the big barrier to the Bank of England raising interest rates (which would strengthen sterling) is Inflation. With prices having actually fallen in the last few months Inflation is a big worry for the UK economy. Any interest rate hike is highly unlikely given the uncertainty about Inflation, time will tell to what extent this situation improves but with Inflation Hearings next week the pound could easily come unstuck if the wrong data comes out. Other important information will the Chancellor’s Autumn Statement which could easily upset the rates and provide a less buoyant picture of the UK economy. Actual raw data comes in the form of the latest GDP figures on Friday which is probably the big highlight. All in all the UK and the pound are doing well but lately events elsewhere have created some very favourable levels which may not last. If buying Euros with pounds we are at close to an 8 year high, this could easily be a very good time to buy Euros that should really be taken advantage of.

If you are planning a transfer and wish to get an overview of your position and the market please feel free to email me Jonathan on jmw@currencies.co.uk

Poor UK Retail Sales Halt the Pound’s Rise (Matthew Vassallo)

The Pound has trended on an upward curve against the EUR recently, with GBP/EUR levels creeping back towards the high’s we saw in the summer. This positive move was accentuated earlier this week following better than expected inflation data for the UK, which helped boost GBP/EUR levels up to 1.43. This was particularly poignant as low inflation has been one of primary concerns for the Bank of England (BoE) over recent months and although it is not at their target level of 2%, it is steadily improving.

The BoE have remained steadfast in their commitment to ensuring inflation levels reach their target level before they will commit to an interest rate hike. With this now looking unlikely for at least the next 12 months, the Pound will require other positive facets of the economy to drive it forward. Although we have seen a generally consistent run of positive data for the UK over recent months, we are not immune to further dips in our economic output. This was proved following the release of this morning’s UK Retail Sales figures, which came out worse than expected and halted the Pound’s rise in its tracks. I feel the EUR will continue to find support around 1.43 and we are unlikely to see the Pound break through the summer highs under current market conditions.

GBP/USD levels have remained fairly flat of late, with the Pound finding support around 1.52 on the exchange. However, I don’t see a major improvement for Sterling before the New Year, due to the likely December interest rate hike by the US Fed. This is now being factored into Cable exchange rates, so I wouldn’t anticipate a move under 1.50 if it does occur. If for any reason the Fed go against the grain and don’t hike rates, then expect GBP to gain value.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me directly on mtv@currencies.co.uk

Sterling to lose value against all major currenies tomorrow morning. (Dayle Littlejohn)

Tomorrow at 9.30am is the latest retail sales figures for the UK. With an expected 2.3% drop from last months figure we are expecting to see the pounds purchasing power dented.

Later in the afternoon the European Central Bank are set to release their policy meeting  accounts. If the ECB continue to take a dovish tone we could see sterling make back possible losses from the mornings trading period.

To finish the week the UK are set to release their latest Public Sector Net Borrowing numbers. This release is set to impact sterling exchange rates therefore talking to an experience broker about a limit order and stop loss is wise.

If you have a currency transfer to make and want to save money on exchange rates compared to using your own bank then contact me directly for a free quote. Dayle Littlejohn drl@currencies.co.uk.

The pound has been doing well but will this continue for next week?

The pound is at multi year highs against a number of currencies as the global economy evolves and investors shift investments to reflect where they believe the future is headed. Globally trillions are traded on exchange rates reflecting investors attitudes towards currencies and their respective economies. In the main sentiments focus on the US raising their interest rates which has led to Euro weakness and some mixed signals on sterling. The pound has risen as it becomes more likely the UK will raise rates if the US do, however the pound has fallen as funds are moved from sterling to the US dollar in anticipation of the USD strengthening. The main focus for the pound too has been the UK raising interest rates which  is now actually looking less and less likely because of the Inflation situation, essentially the pound could easily sink because there is a a very low likelihood for the UK to raise interest rates whilst the Inflation rate is in negative territory.

The prospect for the pound next week is not too good with a number of key releases relating to Inflation on Tuesday. Simply put if I were buying a foreign currency with the pound I would be expecting a drop in the value of the pound next Tuesday as Inflation has been the biggest problem area for the UK. This could actually present some very good opportunities to sell a foreign currency and buy the pound too! Thursday is the latest Retail Sales figures for the UK with Friday offering up Government borrowing data highlighting any rise or fall in government borrowing.

If you are buying or selling the pound the next week is looking like a very important one to identify a new trend line on many currencies. GBPEUR is close to some of the best levels of this year whilst GBPUSD is threatening to break the as yet evasive sub 1.50 level. For more information at no cost or obligation please email me Jonathan on jmw@currencies.co.uk

UK Unemployment Falls to 7 Year Low! (Matthew Vassallo)

It’s been a busy morning for the UK with a host of employment data released, along with a public address by Bank of England (BoE) governor Mark Carney. We’ve see some fluctuation on Sterling exchange off the back of these releases, with the Pound gaining position against the EUR, USD & AUD.

All eyes were focused on the UK unemployment figure, which came out better than expected for a second consecutive month. The official figure of 5.3% has moved the unemployment rate to a 7 year low, which is further evidence that the UK economic recovery is still firmly on track. This is particularly encouraging when you consider unemployment levels, along with inflation figures has been one of the primary concerns for the BoE over the past couple of years. It wasn’t all positive news for the UK however, with the average earnings coming out worse than expected at 2.5%. It was interesting to note that GBP/EUR levels did not improve initially following news that unemployment had fallen, probably due to the average earning figures, which initially diluted any positive move for the Pound.

The catalyst for Sterling’s improvement was BoE governor Mark Carney’s public address, where he remained bullish regarding most aspects of the UK economy. He highlighted our Manufacturing sector as a major positive, which has shown continued improvement over the past 12 months.

In reference to David Cameron’s recent statement, which set out guidelines for our future participation in the EU, I thought it was poignant that Carney stated regardless of the decision of 2017’s EU referendum the UK economy would continue to flourish. He went on to say that the ‘UK has enough domestic strength to overcome foreign weakness’, which will help to alleviate investor concerns over the negative impact of the on-going Eurozone debt crisis.

This led to market gains for Sterling, although with a UK interest rate hike now firmly on the backburner, I do expect both the EUR and USD to find support around the current levels.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on mtv@currencies.co.uk

Sterling shrugs of Bank of England comments

Sterling has risen against most currencies this week despite comments from the Bank of England that interest rates could be on hold well into 2017. The fact is the UK is from an investors point of view a very attractive country to be investing in with some very solid long term growth prospects and increased chances of an interest rate rise at some point in the future. Contract this to other options like for example the Euro. The Eurozone are still riddled with fears over further QE (Quantitative Easing) which will only serve to weaken the Euro currency longer term. Do you remember when the GBPEUR rate went to almost 1 GBP = 1 Euro? The pound was exceptionally weak at this time because the Bank of England unleashed a major round of QE which greatly unsettled the pound. Well those movements are now being replicated on the Euro with the Euro struggling to find any traction against most currencies, one of the beneficiaries of this Eurozone uncertainty is sterling. If you are buying or selling Euros for sterling we have seen almost ten cents movement in 3 weeks! If you need to make a trade why not email me for assistance? Please use jmw@currencies.co.uk

It isn’t just events across the Channel boosting the pound, events across the pond in the US are also bolstering sterling’s appeal. The US Federal Reserve are discussing raising their base interest rate by the close of 2015 at their December meeting. This prospect is strengthening the dollar and leading investors to back sterling too on the understanding if the US hike then it is more probable the UK will also follow suit. Again despite the Bank of England explaining this is unlikely investors still feel sterling is worth the punt at this stage.

Event this week to take note of!

If you need to buy or sell sterling there is some key data this week you should be prepared for. Wednesday is the release of the latest Unemployment data for the UK. With the Bank of England linking raising rates in part to improvements in averages earning, this is a key indicator to impact sterling exchange rates. This week it is important to take note of key information from the Eurozone and the US as these events will affect sentiment towards the USD and Euro which will lead into movement on the pound. I might be making this all sound complicated but trust me it is all very easy once you know! Friday is a big day with Eurozone GDP (Gross Domestic Product) and then US Retail Sales. I would expect both releases to have an impact on the market and would be more than happy to explain to you how and what to expect if you contact me.

Movement on exchange rates can make a big difference on the amount of currency you receive. For more information on what could move your rate and details on how to get the best exchange rates please speak to me Jonathan on jmw@currencies.co.uk

Will Recent Sterling Strength Continue? (Matthew Vassallo)

Sterling has continued its positive run against the EUR during the early part of the trading week, despite not making a major impact against many of the other major currencies. Personally I did not expect such an improvement over the past couple of weeks and despite GBP/EUR rates breaching 1.40 again, I do not expect levels to climb back up to the highs we saw in the summer.

Whilst the trend remains positive, there is nothing tangible that is driving the Pound’s value up. For this reason it is likely this move is based more on negative connotations surrounding the Eurozone economy, rather than any overriding market confidence in the Pound. Due to the on-going instability within the Eurozone region, it is almost impossible for the EUR to make any sustainable impact against GBP and this is evident based on the recent market trend. It was only a couple of weeks ago that there was talk of the EUR putting pressure back on 1,30, only for the single currencies value to disintegrate almost in an instance.

The Pound did receive a boost following a run of positive economic data and this was true of yesterday, where UK Manufacturing data came in better than expected at 55.5. There was very little data of note released today but it will be interesting to hear European Central Bank (ECB) president Mario Draghi speak tonight, to see if he gives us any further insight into the Eurozone economy and the plans being instigated by the ECB to help drive the region’s economy forward.

Personally I would not be gambling on a market which is so uncertain and with the Pound relying on outside factors to drive it’s value higher, I would be tempted to lock in a position which is amongst the best we’ve seen over the past decade.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchanger rates with your current provider, then please feel free to contact me directly on mtv@currencies.co.uk

Sterling Rises Following Positive UK Retail Sales Figures (Matthew Vassallo)

Sterling has enjoyed a positive week on the markets, with improvements against most of the major currencies. This positive trend is particularly evident against the EUR, where the Pound has gained almost 3 cents during the latter part of the trading week. It’s been a volatile couple of weeks for GBP, which had started to dip following some poor data, including a concern over UK inflation figures.

This week’s spike has been attributed in the most part to extremely strong UK Retail Sales figures, which came in above expectation and helped to drive the Pound’s value up. GBP/EUR has touched 1.38 at today’s high and many investors will now be expecting it to put pressure back on 1.40.

This week’s move was not anticipated and proves how volatile and unpredictable the markets are at present. The Eurozone economy remains extremely unstable but at the same time measure have been put in place to help it recover and I’m not convinced that the Pound will be able to hold a position above 1.40 under current conditions. Much of the focus has now turned to the European Central Bank (ECB) and whether they will increase their monetary easing (QE) programme.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me directly on mtv@currencies.co.uk

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