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After a busy week last week for Sterling this week seems as though it is going to be a lot quieter. Last week we saw UK Gross Domestic Product (GDP) figures come out at 0.3%, meaning that the UK avoided going in to another recession and providing a spike for Sterling against most major currencies. There is not a lot of data out for the UK this week, manufacturing data came out better than expected this morning and we saw a small spike for the pound but apart from this there doesn’t seem to be much going on in the UK.
In my opinion there are two data releases this week that have the potential to rock the markets. First up is the European Central Bank (ECB) Interest Rate Decision which will be released at 12:45pm tomorrow afternoon. There is a lot of speculation at present that the ECB are going to cut interest rates to improve their declining inflation. Inflation figures for the Eurozone were released yesterday showing a 0.5% decline. Generally an interest rate cut will increase public spending, in turn boosting growth and inflation. If the ECB chooses to cut their rates then I can see a strong bout of euro weakness against most major currencies, however with so much uncertainty still surrounding the Eurozone I can’t see this holding for very long.
I think that the other major data release this week could be US Non-farm payroll data out at 1:30pm on Friday. This always has the potential to change month by month and has a reputation for moving the markets significantly after its release. It is expected that the figure will be announced at 150,000 but anything other than the expected could cause some significant USD volatility.
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Yesterday was a very busy day on the markets for Sterling, making larger than expected movements against most major currencies. I personally believe that from now until UK Gross Domestic Product (GDP) figures are released next Thursday the pound will undergo heightened volatility.
Sterling took a major hit yesterday after unemployment data was released showing that the amount of people out of work in the UK has risen by 2.56m up to 7.9%. We saw this have a major effect on the pound in early trading yesterday but as the day went on Sterling seemed to make a small fight back against most major currencies. This negative data is not good for the UK and Sterling in the build up to GDP figures next week, remember if there is negative growth in the first quarter of 2013 then the UK will officially be back in a recession.
I am not expecting any large announcements over the next couple of days regarding the pound but it could be worth keeping an eye on Retail Sales figures this morning. With volatility in the market so rife at present and the slightest hint of positive or negative data managing to move the markets this has the potential to form a short term spike for Sterling rates.
If you have an upcoming currency requirement and would like more information on how the currency markets work or the best way to obtain a favourable exchange rate then please contact me direct at firstname.lastname@example.org . We have a team of professional, experienced currency brokers here to make your currency exchange as easy and efficient as possible.
Sterling has lost a lot of ground against most major currencies since the start of 2013 but with growing global uncertainty could we see more of a push from the pound? There has not been an abundance of data releases concerning the UK or the Eurozone this week yet we have still seen GBP/EUR rates range between a low of 1.1684 and a high of 1.1813. This seems to be down to growing uncertainty surrounding both parties.
It is no secret that some Eurozone economies have been struggling recently and it seems as though we are constantly hearing rumours that another Eurozone state is heading towards financial meltdown. Couple this with the fact that there is a distinct possibility the UK could be heading in to a Triple Dip Recession and this all creates a lot of uncertainty in the market.
On Tuesday The National Institute for Economic and Social Research (NIESR) announced that they estimate the UK economy has grown by 0.1% in the first quarter of 2013, revised up from -0.1% in the previous announcement. This figure was an estimate of what will come out when Gross Domestic Product (GDP) figures are released in two weeks time. In order for the UK to avoid a recession this figure would need to be 0% or higher, this is how tight it is!
My general opinion is that the GDP announcement will be the main market mover in the coming weeks and with it being such a close call we could see Sterling fluctuate in the build up. I personally feel that if the UK goes in to a Triple Dip Recession then we could see Sterling fall significantly against most major currencies, on the other hand if it is avoided there could be some strength for the pound off the back of this.
We have a number of different contract options that can help safeguard your funds against sudden market movements. If you would like to speak with one of our professional, experienced currency brokers then please contact me direct at email@example.com
The pound has enjoyed a big boost following last week’s better than expected GDP figures. Gaining over 2 cents against the Euro and one cent against the Dollar such unexpected news shows the importance of keeping in close contact with the authors here on pound sterling forecast. Will these gains last and what can we expect today?
Well there is not a huge amount of sterling data out but pound sterling rates will be moved by other factors. The only sterling data this morning was a consumer confidence survey which actually showed a fall in confidence among consumers. And I personally would agree with these sentiments. Even though the economy is now ‘growing’ I don’t think the man in the street would say he was particularly better off than he was earlier this year, if at all.
The first data sets of interest have been German Retail Sales which were down year on year and has given the euro a slight loosening this morning against sterling. At 10.00 we have the Eurozone Unemployment rate which could be a market mover and set the tone on GBPEUR for the rest of the day. There is also a conference call by the ‘Eurogroup’, a team tasked with assisting Greece, but no firm decisions are expected. I think anyone selling Euros would do well to take advantage of this current lull in the debt crisis as surely it is only a matter of time before events spiral out of control.
At 12.30 we have Canadian GDP data which could cause the CAD to dip back below the magic 1.60 mark if it comes in stronger than expected. GBPCAD buyers have been enjoying some of the best rates in four months so if you have a GBPCAD requirement I would take stock and consider this a good buy opportunity.
In the US the after effects of Hurricane Sandy will surely capture headlines although we have not seen a huge amount of movement on rates. Concerns on the dollar are beign shaped around the outcome of the US election and anyone with an interest in any currency pairing should be aware of the potential impact this could have on all currencies. The USD is a ‘safe haven’ currency and moves not just on US news but also global events. The far reaching economic and political implications of a new US President can affect these sentiments and cause unexpected changes on rates.
On the sterling side at 18.00 we have Deputy Governor Bean of the Bank of England give a speech which could be indicative of policy, although over the weekend he did speak playing down the significance of the recent good GDP news, with no major new news since the weekend it is likely therefore his speech will not contain anything unexpected but we should watch for any indications of more QE. All in all not the biggest day for the pound itself, but don’t be surprised to see pound sterling rates move on the back of shifts in sentiment.
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Pound Sterling Forecast 13/08/12 – 17/08/12 – Will the Olympics benefit the pound? Retail Sales Thursday will provide an early sign…
What can we expect on pound sterling exchange rates this week? If you are considering any currency transactions involving the pound, movement on exchange rates will affect the value of currency you receive. Our completely free, no obligation site provides some of the information necessary to consider when making a currency transaction.
This week there is plenty of economic news and data to move exchange rates
Monday – Aside from Greek GDP which could affect GBPEUR slightly, there is not a huge amount to beware of today on pound sterling rates.
Tuesday - With German and French GDP released before 7am, the main focus is at 10 am UK Time when we have Eurozone GDP which will probably take most of the attention on GBPEUR this week. There is also some UK Inflation data but I don’t expect this to have much of an impact. With negative data expected we could easily see the Euro get a lift if things are not quite as bad as expected. This is the one to be aware of if interested in the Euro this week.
Wednesday - The most important day for the pound with the Bank of England Minutes. Whilst no change in economic policy has been seen, Mervyn King made clear in his Quarterly Inflation Report things are probably going to get worse before they get better for the UK. With so much uncertainty a member voting the wrong way could really affect pound sterling rates. To be kept informed of what is happening ahead of the release why not contact us. We can help with the very best rates of exchange and keep you informed of developments so your transfer does not become too expensive. Feel free to contact me directly on email@example.com for more information. Wednesday also sees UK Unemployment data which could easily alter the value of sterling.
Thursday - Retail Sales are released in the morning and will be the first sign of the Olympic effect. Has the Olympics benefitted the pound? Early indications suggest that no is the answer, however with all of the extra celebrating due to Team GB success there is bound to be some kind of boost to the economy. Historically Olympics do provide a boost to an economy and looking at the thousands of people in London clearly enjoying themselves and spending money, I am sure there will be some positive effects. We did however have a very wet couple of weeks at the start of July and this could have dampened what would otherwise have been a gold winning month for Retail Sales.
Friday – With no major economic data out for the pound, we will probably be debating the after effects of Wednesday and Thursday’s releases. We have Trade Balance and Current Account figures for the Eurozone which may well provide some further movement on Euro rates.
POUND STERLING FORECAST
GBPEUR – I expect that the pound will fare well this week following the Olympic effect. Whilst I don’t think we will see GBPEUR reach the high of 1.2890, I think it will touch 1.28 as poor EZ data reminds investors of the huge challenges ahead still in Europe. The Bank of England Minutes I don’t believe will hurt the pound and we should see a relief rally. At the end of the week I expect to be over 1.28 on the market price.
GBPUSD – I expect the Dollar will remain under pressure due to threats of more QE in the US. With a large amount of US data out this week I expect the case for more QE will be hardened. I am basing this on the fact that US data has been rather soft lately and hence isn’t going to be any different this week. Therefore the volume of data will provide a stronger case.
GBPCAD Focus – As I reported last week the CAD is looking a great bet with investors as the economic conditions remain firm. Compared to the rest of world it is not swimming in uncontrollable amounts of debt and a recent spike in Oil prices is keeping the currency strong. Even with the threat of US QE (the CAD often loosely tracks the USD) the CAD is holding its own.
Unfortunately neither I or anyone else can guarantee their economic predictions. What we can do is make clear to anyone who needs to make a trade what their options are and what they should be aware of that can move their rate. We are able to offer rates that can beat banks by 4% and more and I for one have never been beaten on a price by a bank or a currency broker.
For a free analysis of your position and what will move your rate please feel free to speak with me Jonathan directly on 01494 787 478 or email firstname.lastname@example.org
Exchange Rates move as demand for a currency increases or decreases. As investors increase their investment in certain currencies we see movement on exchange rates as the price increases and falls. One of the main dictators on investors attitudes to investment is their ‘risk appetite’, i.e appetite for risk. Investors don’t want to be caught out so they will often move in unison to avoid being caught out.
Risk Appetite is very important to understand on exchange rates because it helps us to undestand why rates move the way they do. If we are looking to buy or sell a currency being aware of the sentiments of investors will help you to make a more informed decision and should lead to a much better exchange rate.
The reason I am explaining this is because in my role as a specialist currency broker assisting private and commercial clients with their currency transfers, I am often asked why things have happened and the whole idea of this site is to help anyone making a transfer save money on their rate by getting a better deal and also to time their exchange correctly.
Risk Appetite is a major driver on exchange rates at present with a few key trends emerging according to the sentiments. The concerns are all to do with the Eurozone and the outlook for the global economy.
EURO – If risk appetite is low the Euro will probably weaken. This is why the Euro has weakened so much lately. But as the last 24 hrs shows us, good news can cause risk appetite and confidence to return. GBPEUR high this week 1.252, the low 1.2360. If you would like to trade at these kind of rates not the rates offered by banks we can help, contact me no email@example.com for more information.
USD – The US dollar is a safe haven. When risk appetite is low investors will move to the dollar to keep their money ‘safe’. Due to the size of the US economy it is thought that whatever happens, dollars are always worth holding and as such the Dollar remains fairly strong. But when confidence returns and risk appetite is high investors look to other riskier assets and the dollar will weaken.
STERLING – Also a safe haven, but has weakened off massively in recent years reflected by the decline of economic and political influence the UK has over the world. We have seen the pound find favour lately but it could easily fall like it did last year. The UK is not the force it used to be but maintains an important platform on the international stage and the pound will always benefit from its history and status amongst the other currencies.
AUD, KIWI, ZAR (RAND) – These are the riskier assets that strengthen when risk appetite is high. They offer higher interest rates than the major currencies and as such investors pile in when they think there is a good chance they will appreciate in value (plus investors gain from the trade due to the higher interest rates). Even though these economies are arguably stronger and performing better than their Western partners, their currencies are deemed riskier and hence will fluctuate according to sentiment. Anyone tracking these will have noticed they have toughened up today due to the EU summit coming out positive for the Euro.
CAD, NOK – Also to an extent riskier but lately have weakened due to the falling price of Oil. If global demand (orders) pick up due to confidence in the Eurozone returning, the price of Oil could start to increase and hence these currencies will strengthen.
Next week is a really important week for the pound and I think we could well see the pound lose more ground. Please see my post earlier this week http://www.poundsterlingforecast.com/2012/06/26/why-i-think-the-pound-will-fall-soon-good-news-for-sterling-buyers-bad-news-for-sellers/
This site is set up to offer our clients and new clients informatoon on exchange rates with a view to saving them money. If you are unsure if you are getting the best rate or would like any information on what is driving your exchange rate, please conatct me personally as I would be very pleased to speak to you about your trade and why I am wholly confident we can offer you a much better proposition.
For further infiormation please speak to me Jonathan on 00 44 1494 787 478 oremail firstname.lastname@example.org
Enjoy the weekend
Despite the Euro crisis affecting confidence in the UK, sterling is still holding much of the value that saw it hit close to a 3 year high against all currencies only last month. And this morning despite some very alarming Public Sector Net Borrowing Figures, the pound is holding favour. I believe this is all to do with the fact sterling is a more attractive bet than the other majors because it is attempting to deal with its debt problems, however unsuccessful this is proving. It is perhaps a case of being the ‘best of a bad bunch’ rather than a stand alone favourite.
Great news for anyone buying a foreign currency with the pound but will it remain?
Anyone considering a trade involving the pound soon should beware of yet more Quantitative Easing…‘QE typically weakens the currency concerned by increasing the money supply’. This is likely to be unleashed as soon as next Thursday and it is sure to cause the pound to fall in value. Regular Traders may cast their minds back to the Summer of 2010 when GBPEUR was just like today, up above 1.20. At this time we actually saw 1.2350. The situation on GBPEUR was almost identical to now. Confidence in sterling was high (despite the UK economy suffering), and confidence in Europe was low as a result of Greece and the debt crisis. By October the rate had dropped 11 cents to 1.12. I will repeat that statistic because it is very powerful. By October the rate had dropped 11 cents to 1.12!
This was all due to the fact the economic recovery in the UK was felt to be insufficient to warrant an interest rate hike in 2011 and more QE was likely. The similarities with today’s market is clear and athough QE is not quite the nasty word it once was (It was the first round of QE that helped push the pound down to near parity) I feel that anyone with an interest in the pound should be aware things could quickly deteriorate. There is in my most humble opinion more chance of the pound losing value in the next ten days than gaining value. So let us look at what else is ahead besides next Thursday’s announcement…
DATAWATCH – UK GDP Final Estimate Q1- Thursday 09.30 am. The UK is technically recession but just how bad is it? This release on Thursday could set the pace for movements in the next week on sterling.
Don’t forget that we also have the all important PMI surveys early next week. These Purchasing Managers Index surveys are very important snapshots of the relevant sector in an economy. Please read Mike’s post earlier this year on PMI for more information on PMI http://www.poundsterlingforecast.com/2012/05/03/sterling-hits-a-33-month-high-against-a-basket-of-currencies-on-a-trade-weighted-basis-but-euro-buyeres-be-wary-of-the-ecb-interest-rate-decision-at-12-45/
Monday 2nd July we have Manufacturing PMI, followed by Construction Tuesday 3rd July and Services 4th July. All of these really have the propensity to move the market and are worth being aware of if looking to buy or sell the pound.
The pound could easily drop a cent or two against most majors because of bad news although last week the increase in Bank of England members voting for QE caused the pound to dip briefly before making a recovery. If the same happens again, anyone selling a currency to buy sterling should be poised ready to act quickly should the pound rebound, or if there is no QE, the pound may rally on the relief factor. We have not really seen Sterling break in either direction on all the majors in the last few weeks so it could well be due some movement. If this is true the next 10 days of data could be really important. If planning any transfers it would be a real shame for you to miss out on these levels, particularly against the Euro. We are trading on GBPEUR at the best rates in over three and a half years!
If you would like more information on anything contained in this post please let me know. I work as a Senior Dealer for the UK’s Largest Independent Currency Brokerage and would be pleased to offer my assistance to anyone who wishes to learn more. And if you would like any updates relating specificly to your personal exchange requirements please feel free to contact me personally on email@example.com or even call me on + 44 1494 787 478.
I hope you have found this useful and look forward to any enquiries, comments or suggestions.
The pound has been on an incredible run of form in the last few weeks as fears over the single currency cause investors to change their positions according to changing economic sentiments. Sterling against the Kiwi, Rand, Loonie and Aussie has been at its best all year in the last couple of weeks. And against the Euro and Dollar too, the pound has made excellent gains which many have capitalised on. The question we can now ask is what next, will this run continue? We have covered in posts over the last few weeks how the pound has found favour because of the UK’s approach to its debts and budget deficit. Compared to the mire developing in the Eurozone, and the US’s reluctant attitude to confront its debt problems, the pound has found favour as traders feel the UK is setting itself up to be in a better position down the road. Is this really the case though?
There are a number of reasons why anyone hoping the pound will continue to make gains on EUR, USD, AUD, CAD, NZD, ZAR and all the rest should beware. Let me explain some of them here:
We are in recession! Stating the obvious perhaps? But when this was announced last month the pound barely moved against most currencies. Recession means the economy is shrinking. That makes dealing with the massive debt pile even more burdensome. With Mervyn King himself predicting no return to growth until the later part of the year the economy and the UK’s ability to tackle its debt has therefore stalled. Will those investors who currently favour the UK’s approach be so supportive if the very measures designed to keep the UK ‘safe’ are in fact doing more harm than good? I would not be surpised to see a real run of bad data in the coming months particularly with the Eurozone crisis going from bad to worse.
UK plc needs a strong Europe You do not need to read too far in the press to find negative comments about Europe. This has and probably always will be the case. The reality nowadays is the UK needs a strong Europe to keep our economy strong and foster growth. One estimate puts at 40% the amount of trade the UK receives from Europe. Many of the private businesses Mr Cameron and co regularly put pressure on to drive through the recovery, rely heavily on orders from Europe. The UK is also deeply exposed to the European debt crisis through our banking sector. If the banks runs in Europe continue to weigh on the European banking sector and the Governments and banks cannot pay back their debts to the UK, we could see UK banks needing recapitalisation. The UK is still limping, licking its wounds from the last financial crisis. The last thing it needs is another kicking now! If considering any transactions involving the pound the next few weeks could really push things one way or the other. To find out more specific to your requirements please feel free to contact me personally on firstname.lastname@example.org or call +44 1494 787 478.
More QE may be inevitable More Quantitative Easing may be the only option to kickstart the UK’s economy later this year after we are all partied out from the Olympic and Queen’s Jubilee celebrations.
Markets move on sentiment and rumour The currency markets are often only reflections of sentiments. Currently the UK is favoured but this can quickly change. This Thursday, May 24th we have the first revision of UK GDP data for Q1. This data could well expose the reality that the situation in the UK may well get much worse before it gets better. Despite the huge undertakings by the current government the UK’s debt position is still torrid. The fear that may easily creep into investors minds in the coming weeks may be the reality the coalition has cut too much, too fast and has choked off the recovery. Remember it only needs to be these sentiments that develop for the situation to turn. If you are considering an exchange and are happy with current levels or would trade at a slightly better rate why not make us aware? Our highly personal service is designed to ensure you get the most from the markets and we can be your eyes and ears in the market.
I feel personally that with so many clear challenges ahead for the UK, the current positive sentiments for the pound may soon falter. One thing you should always prepare for on exchange rates is the unexpected and if considering any currency exchanges at the moment, to beware of all the events that could move your rate. The current Eurozone crisis may only get more problematic in the coming weeks and the negative effect this could have on the UK and the pound should not be forgotten.
Here at pound sterling forecast we are currency specialists working for the UK’s top currency brokerage. Through this website we can not only offer our expert analysis and opinion, but can also personally assist prospective clients with our award winning service and rates. I have never had any trouble making sure anyone who contacts me via this site gets the very best rates. Even if you have another source you are using, it is always worth a second opinion to double check what you are doing and that you really are getting the best deal. We offer a highly personal service to clients all over the world so to find out more about all of your options please feel free to email me directly on email@example.com or call +44 1494 787 478.
I look forward to hearing from you.
UK GDP figures released this morning underlined previous expectations that the UK could be heading back into a recession. This morning’s revision for the last quarter 2011 was revised downward to -0.3%, against the expected and previous -0.2%. This has caused the pound to lose slightly in early morning trading against most currencies expect the Aussie which is still suffering from a sell off following poor data from China.
Despite some very encouraging signs of late we have warned that the pound looked rather fragile and this morning’s release has provided a good opportunity for anyone selling a foreign currency to buy sterling. For anyone looking a bit further ahead the real question is will the UK enter recession? This morning’s data certainly makes it more likely but I think on balance we will not see a technical recession. This is because despite the poor Retail Sales for February, economic data has generally been positive for this quarter. The key date for anyone is 25th April, when the first revision for Q1 2012 is released.
If you are selling a foreign currency to buy sterling I believe you are currently looking at a great opportunity. With sterling moving to a 13 month high against a basket of currencies recently, there is a key trend being formed which I cannot see changing anytime soon. If looking at sterling historically it has always been significantly stronger against most currencies. Against the Aussie and Kiwi we used to enjoy levels of 1-2.5 at times! The pound has weakened signficantly since then due to the economic crisis but it does appear that slowly this tide is turning and it may be that the very worst for the UK is over, even if we do briefly dip into recession for the next quarter.
We offer a highly personal specialist service for private clients and businesses with a currency transfer to undertake. We can book rates forward for up to two years as well as insert stops and limits into the market to ensure your transfer does not become too expensive.
We can significantly undercut the banks and I personally have never had any trouble making sure anyone who I speak to gets the absolute best deal, above that offered by banks and other brokers. If you wish you to just double check what you are doing or have a free no obligation chat regarding your transfer, please feel free to email me on firstname.lastname@example.org and I will get back to you as soon as I can. Our service is designed to make sure your transfer isn’t unnecessarily made more costly and that you are aware of all your options.
I look forward to your questions, comments or enquiries!