Tag Archives: weakness

The pound surges in late trading but further losses are expected in the days to come. (Ben Amrany)

Sterling has today had an extremely volatile day’s trading all mainly due to the uncertainty of the Scottish referendum. It is currently playing havoc with the pound and today we have seen a high to low spread against the Euro from 1.2397 to 1.2543 and over a cent high to low against the USD.

The last poll showed there was a 50/50 split but we are expecting an update tomorrow and any signs that the YES vote is ahead once again expect to see further sterling losses. The Swings in the market is going to show how nervous the UK markets are about Scotland voting in favour of independenceand several news reports have highlighted how damning it will be for the UK economy.

Here we have seen a massive increase in the volume of clients buying and selling the pound as the uncertainty is very concerning. With reports that a YES vote could cause the pound to fall by as much as 10% if you are buying or selling sterling you have to ask yourself how much risk to gain ratio you want to take on your exchange because even if a NO vote (which we do expect) happens the pound may only climb by 1-2%. If you take into account what the losses could be it is just not worth the gamble in not exchanging your funds now. This time next month we could be as high as 1.27 or as low as 1.17. This is a real likely spread depending on the outcome and you may be wise just to know how far your funds are going while the rates are still favourable.

So if you are looking at buying or selling a specific currency you may be wise to speak with myself Ben Amrany and I can explain all the options available to you to help you minimise your losses while helping you achieve a much better rate than what the high street banks will offer. You can email me with your contact details and requirement at bma@currencies.co.uk and I will contact you to explain the current market place and  how best to minimise those losses.

Thank you for reading

Ben Amrany

bma@currencies.co.uk

 

 

 

Sterling back below 1.25 against the Euro (Ben Amrany)

After yesterdays bank of England which gave the pound a real boost after two members of the Bank of England voted for interest rate hikes we have seen the pound lose all of its gains against the Euro, USD and the southern hemisphere currencies. The losses have been on average about 0.3%

The Euro is now below 1.25 the Dollar is in the 1.65′s and this is a massive decline compared to two weeks again when the rates were above 1.26 & 1.70 respectively. The losses today occurred when retail figures showed a decline from the anticipated rate and has hindered the pound.

All data at present is having a real time effect on when the markets predict this first interest rate hike in the UK. The quarterly inflation report a couple of weeks ago hindered the pound when interest rate hike expectations were put back to February 2015 at the earliest now and all UK data which comes out negatively can theoretically push back this data back. We are expecting this dip for the pound to cement itself between 1.24 and 1.2550 over the next couple of weeks.

Tomorrow there is no data to note of out of the UK and we could find a very dull end to the week and with a bank holiday on Monday the markets should be flat until Tuesday. If you are looking at buying or selling you may wish to asses things before the long weekend to make sure you do not get caught out of there are any big movements.

With contracts available like forward buying where you can secure what you need now and pay for it at a later stage this can help you budget to the full and give you the peace of mind to know how far your funds are going. For more information on this or any other part of the service we offer please do feel free to contact myselfBen Amrany at bma@currencies.co.uk 

Thank you for reading

Ben Amrany

 

Sterling weakened so now are the best rates to sell Euros & Dollars to buy the Pound (Ben Amrany)

The pound has had a very bad day weakening significantly against most of the majors. Comments from the Bank of England Governor Mark Carney saw the pound fall from highs of  1.2632 to a low of 1.2468 against the Euro. The Dollar was a similar theme falling from 1.6843 down to 1.6685 and some the biggest losses were against the southern hemisphere currency with over a 1% drop against the Australian & New Zealand Dollar along with the Rand.

Have the wheels come off for sterling exchange rates? 

The Quarterly Inflation Report by the Bank of England dampened the hopes of any future interest rate rises in the UK as markets are now expecting that first rate to be no earlier than February 2015 while prior to the report we were expecting a rate hike as early as November. The report also slashed its wage growth forecast from 2.5% to 1.25% That forecast comes as official figures showed average wages excluding bonuses grew by 0.6%

Wage increase is one of the biggest concerns for the BoE before raising these interest rates. Carney’s also commented that the value of the pound has been to high and it has been effecting UK businesses and their exports of late.  So I ask. is this the start of the decline after we have witnesses really good gains in the last year. Nothing continues to go up for ever and this Friday the GDP figures will give us a good indication if the pound can recover today’s losses.

We expect to see growth for the UK economy but the key for the pound will be determined by whether growth is above or below 0.8% for the quarter and 3.1% for year on year.

If below forecasts we may see the pounds trend from today continue and a target of 1.2450 may occur so you may be wise to secure your funds before this key release. GDP is one of the biggest factors that affect the pounds movements and while we are still trading at very attractive levels now may be a wise move to act and secure your funds.

if you are looking at buying or selling the pound please feel free to email myself Ben Amrany at bma@currencies.co.uk and I will introduce myself and the service we can offer a little more formally. Rates can be up to 4% better than the banks and we will help youtry and time your exchange.

Thank you for reading

Ben Amrany

bma@currencies.co.uk

 

Will sterling rise higher still? When will this happen?

This week we predicted the pound could rise higher and so it has. Improvements in the Unemployment picture have given sterling a leg up against its peers which represents yet more fantastic opportunities for anyone buying a foreign currency with sterling. Assuming the forecasts for GBP strength are right, how high will the pound rise and when will we see the next spikes?

Despite the awareness of problems in the UK’s recent economic surge there appears to be little stopping the pound at present. A suspected housing bubble, problems of low wages and fears of an over reliance on consumer spending have all done little to dent confidence in the pound which seems to be going from strength to strength.The overriding factor is the fact the UK is on an economic upturn well established versus a Eurozone effectively going backwards and a US still reliant on a QE programme. The UK offers an excellent place to invest with the prospect of higher interest rates and a more buoyant economy in 2015.

Next week is a range of data to move the market, all of which should be quite interesting and could provide yet more opportunities for the brave! Wednesday and Friday next week look like the busier days to me. Wednesday we have the Bank of England Minutes form their latest meeting and Friday PSNB (Public Sector Net Borrowing) data. Last month PSNB caused the pound to drop a little so these releases are by no means guarantees you will get more for your money!

Ultimately no one can tell you what is going to happen on the market. However our position as currency market specialists gives us strong insight into what may happen, plus we have the experience and expertise in place to properly manage your exposure to the currency markets. For more information at no cost or obligation please contact me Jonathan on jmw@currencies.co.uk

 

Has the pound reached a peak against its peers?

Unexpected pressure has surfaced recently with mortgage approvals falling and government borrowing increasing. It is no good to see improvements in the economy if coalition plans to reduce the budget deficit are scuppered with increased borrowing!

I think you would still have to favour sterling over most currencies but it may be possible that some of the more recent multi year highs on GBPEUR, GBPUSD and GBPAUD amongst others have now been reached. If you need to buy a foreign currency with sterling it should not be readily assumed rates will just keep climbing as they have done for the last couple of months…

Next week promises to be an eventful one with the start of a new month and a new round of economic data to move markets. I feel it would be a real shame to miss out on what are still some very attractive levels to trade sterling and suggest anyone with an upcoming requirement acknowledges current levels and the vast improvements from last year. Topical elections at home and abroad raise the prospect of longer term political uncertainty which can cause unfavourable currency movements. The Scottish referendum still looks like it could cause some turbulence on exchange rates and is another factor which could weigh on the pound later this year.

Recent and current Sterling strength is based largely on expectations of interest rate hikes in 2015. The scope for weakness before then is as we have seen very real and I do feel anyone with currency requirements later this year may do well to take stock of current levels. Don’t forget you can book funds out on a forward rate which for a small deposit now guarantees your price for the future. For a full overview of your position please email jmw@currencies.co.uk

Pound sterling forecast quoted in the Daily Mail today!

You can read the full link here. If you have any currency transactions to undertake and wish to learn the forecast please contact us. We primarily specialise in handling larger currency transactions (GBP 10k and upwards) but do hope our loyal readers and Daily Mail readers alike find our information useful!

Jonathan

jmw@currencies.co.uk

 

Big week ahead for sterling exchange rates. (Ben Amrany)

Today has been a very quiet day on the market for sterling exchange rates as we saw a slight decline against the Euro but we have seen gains against the AUD & NZD.

Tomorrow sees a raft of data released including economic sentiment figures and consumer confidence numbers in the Eurozone alongside retail sales figures for Italy and unemployment data for Spain. The big news though is likely to be the first revision of UK Gross Domestic Product (Growth figures for the economy) which, if revised up could give the pound a big boost and represent some excellent opportunities for those clients looking to transfer funds internationally. Tuesday afternoon sees the focus move across the Pond to the States with their latest consumer confidence figures being possibly the most notable data set. If you have not traded by close of trading in the evening latest UK consumer confidence figures are set to be announced which will give a good indication as to how UK consumers view the economy and any positive figures here could also contribute to the pound gaining on Wednesday morning.

On Wednesday eyes will move over to data from Europe and the US. If there is a strong GDP number from the UK tomorrow and data from other economies are not so favourable Wednesday could be a very good day for the pound. We have German retail sales and unemployment figures, Spanish GDP figures and probably most notably, the latest set of Eurozone inflation data. Inflation has been one of the main factors influencing the Euro recently as there is a large amount of concern that the single currency economy could fall into deflation which could have lasting pressure on their economy. So, should these figures show another drop it could weaken the EUR and lead to more calls for the European Central Bank to act before it is too late hopefully resulting in a spike for GBP/EUR.

Wednesday afternoon we have US GDP figures which, as per the UK’s are likely to be crucial for USD exchange rates but following this we also have US interest rate decision where rates are expected to remain on hold at the record low of 0.25% and another $10bn being reduced from their bond buying scheme as this continues to taper down. Any change from these expected figures could cause volatility.

So the first part of the week is due to be fairly busy with what will I am sure create good buying opportunities regardless of the currency you require purchasing. I always recommend that clients act on spikes in the market to make your funds go as far as possible. We have different contract options which can give you the peace of mind in knowing exactly how far your funds are going. If you would like more information on the currency service I can provide then please do feel free to contact myself Ben Amrany at bma@currencies.co.uk

For information on what is due out in the latter part of the week please continue to check out our site.

If you are in the situation needing to move money internationally and looking for the best price – please feel free to contact the author – Ben Amrany – via the telephone number at the top of the page or via email at bma@currencies.co.uk 

Great Expectations… GBP Weakness…

The pound has dipped this morning despite a raft of good economic data showing improvements in government borrowing and falling budget deficit. There had been some high expectations of seeing the pound move higher due to a more hawkish outlook by the Bank of England but this failed to materialise. As one of my clients said to me ‘you can’t even trust the Bank of England’ nowadays…

This was in reference to their commitment to consider raising interest rates if the Unemployment rate dipped below 7%. This particular caveat was of course met recently causing the pound to spike but for now the BoE will not be raising interest rates, it would simply cause more problems.

If you are expecting the pound to just keep rising you could therefore be very disappointed as we need to see some really good data to warrant such a spike. I find the best way to maximise your return on your currency exchange is to set realistic targets and limits. If you would like some assistance in the execution and planning of your transfers please contact me Jonathan on jmw@currencies.co.uk, even if your transfer is just a once off, we can help get you the most for your money.

Thank you,

Jonathan

 

 

Will the Canadian Dollar weaken in the coming months? Dr Doom believes so! (Daniel Wright)

Daniel Wright

Daniel Wright

For those looking to buy or sell Canadian Dollars I read an interesting report surrounding Canada this morning.

Nouriel Roubini (or Dr Doom as he is known) the man that predicted the big financial market crash before it happened has recently commented that he feels that the Canadian Dollar still needs to weaken by 10% to maintain the Manufacturing sector for the North American Country, this could be achieved by some aggressive easing measures in the near future.

of course whether we actually see something like this happen is actually completely in the hands of the Bank of Canada and not this widely respected economist, however due to the fact that the markets do move on speculation as well as fact this could mean that the Canadian Dollar may be in for a rocky couple of weeks.

At present the GBP-CAD rate is already almost 30 cents better than it had been a year or so ago so those looking to buy Canadian Dollars must already have a smile on their faces – there is a chance that they may even get a little more for their money in the coming weeks.

If you are looking to buy or sell Canadian Dollars in the coming days, weeks or indeed months then it is prudent to have an efficient and proactive currency broker on your side and I can help you with this personally.

The brokerage I work for has won numerous awards both for our exchange rates and customer service so I would be confident I could better any deal you currently receive from your bank or currency broker, feel free to contact me (Daniel Wright) directly by email on djw@currencies.co.uk and I will be more than  happy to help you personally.

Sterling weakness up ahead? Why now is a good time to buy the pound

Jonathan Watson

Jonathan Watson

Currently sterling is well supported largely due to the strong likelihood of the UK raising interest rates next year. Investors are taking up positions on sterling in anticipation of better returns in the future. 80% of currency transactions are speculative and whilst this is not a topic we deal in for clients , it is a topic that is extremely relevant in determining future market movements for our clients.

Longer term sterling appears bound to increase significantly as the prospect of ultra low interest rates becomes the past. The pound has been flirting with 5 year highs on a trade weighted basis which when you consider interest rates have been at rock bottom for 5 years makes sense.

Since we won’t actually see any actual hike for some time there is certainly a good chance of more GBP weakness but it will be in pockets and not reflective of a greater downward trend. If you are going to need to purchase the pound in the future moving sooner is I believe the best course of action. Please contact me directly for assistance in sourcing the best rates and the optimum peaks to trade on. I assure you of being able to beat the banks and currency brokerages.

Many of my clients selling say Euros and Dollars after a property sale are quibbling over the fact they are trading at multi year lows. I wholly sympathise with these clients because when you do the calculation on the losses selling six figure sums in the last year they are substantial. But if you look further back say at the 10 year and 5 year figures you will see current rates are not so bad.

Take Mr Smith in France for example, who may have purchased there when rates were say 1.50. Imagine buying a 200,000 Euro property at 1.50. This would have cost you 133333.33 GBP. Fast forward ten years and unfortunately he has had to sell to come back to the UK and had to take a hit on the price. He had to sell for 175,000 Euros and was not happy at having lost 25,000 on the price. However he managed to get 1.20 on the rate which means his 175,000 Euros are actually worth 145833.33 GBP. Suddenly it is not such a bad deal and when he considers all the fun times he had there, the whole experience has actually not been too bad!

This just shows the importance of exchange rates when considering overseas transactions. Sterling is at a very good level now which may yet improve. Understanding what is driving exchange rates is critical to getting the best deal. For more information on the forecast for your particular situation please don’t hesitate to contact me directly on jmw@currencies.co.uk

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