Tag Archives: weakness

Sterling could be in for a very tough Winter…

Sterling has had a truly remarkable year making firm gains against pretty much all currencies and presenting some of the best rates to buy a foreign currency with in years. GBPUSD hit a 5 year high, GBPEUR has hit a two year high (and not far off a 6 year high!) and GBPNZD and GBPAUD are also both at multi year highs… Clearly sterling is faring well but this now begs the question will it continue?

October is looking like a tough month for the pound  with economic releases from September’s data likely to be poor owing to lower business and consumer confidence due to the Scottish referendum. I feel this is likely to feed into the rest of the year and with it interest rate hike expectations (currently expected in April) liable to be pushed back further. Economic growth in the UK is currently running at 0.8% and with house prices not rising as fast as previously I think the need to raise rates will dampen in Q4.

Tomorrow is some very important Eurozone news on Inflation which will be indicative of how much QE we can expect Thursday from the ECB. With so much volatility surrounding this release making some careful plans ready to trade on the news seems sensible.

I couldn’t possibly fit everything important in one post, would you read the whole article anyway? So if you need to consider a currency exchange and wish for further information please contact me directly on jmw@currencies.co.uk. I work as a foreign exchange dealer and we focus on a personal proactive service to help you get the most from the market. Please contact me for more information regarding your situation.

Will sterling continue to rise

The pound remains at elevated levels and it would appear it shall continue to do so. Expectations of Quantitative Easing in the Eurozone next month are keeping the Euro weak and following the dollar’s recent surge investor appetite for favourite the safe haven looks set to remain cooled for the time being.

The pound was looking in serious danger on the back of a possible Yes vote in the referendum but these fears have now cooled with the No vote. There are however significant reasons for concern for GBP weakness down the line with the UK election and the possibility of the EU referendum to follow. These topics could make the Scottish referendum look like a Parish Councillors meeting by comparison…

All in all the news is generally very positive for the pound at present but further gains in the absence of something ‘new’ to impress investors look limited. If you need to buy a foreign currency with sterling capitalising on these extremely impressive levels might be the best course of action. To be notified of any impressive spikes please contact me Jonathan on jmw@currencies.co.uk

 

Scottish Referendum still dominating the headlines and causing wide swings for sterling exchange rates. (Ben Amrany)

So we are getting closer and closer to the key Scottish referendum tomorrow. The markets over the last couple of weeks have been extremely volatile purely on the back of will the YES or NO campaign be victorious. We are expecting voting to start tomorrow with the decision filtering through in the early hours of Friday morning.

The way that I see it is as follows. There is likely to be a major reaction for sterling, whichever way the vote goes. A vote for independence will highly likely result in a massive sterling sell-off causing the pound to fall by as much as 10% over the coming weeks and months. A vote for Scotland to remain in the UK is likely to lead to a significant relief rally for the pound and we could see a slight gain from the current trading levels.

One of the main reasons why the pound could decline by so much and for so long should the YES campaign win would be due to the reaction from the Bank of England. Interest rate hikes could be pushed back further from the expected Spring 15 target and another bout of Quantitative easing has been muted to get the markets moving should the unlikely happen. This could be disastrous for those looking at buying EUR, AUD, NZD & USD.

For those looking at selling the pound the risk to gain ratio is not worth taking the gamble on what may occur. With the polls so close at the moment the risks of losing thousands of the currency you need to buy by waiting until after the vote could be extremely costly and we have seen many clients capitalise on the current rates due to the uncertainty. Although we believe the NO vote to independence will happen it is not inconceivable that the polls and bookies are incorrect and we could be in for one of the largest historical shocks of our time.

So if you need to buy or sell sterling and would like to be kept up to date with all the latest data releases and exchange rate movements then speak with myself Ben Amrany and I will explain the options available to you and how best to minimise any risks you have on the currency.  You can email me at bma@currencies.co.uk 

In other news the Minutes from the Bank of England’s last interest rate decision showed no change in the voting with a split of 7-2 not voting for a rate hike. Unemployment also dipped slightly which assisted the pounds gains so now eyes will be firmly on retail figures tomorrow and that key vote.

Thank you for reading.

Ben Amrany

bma@currencies.co.uk 

 

 

 

 

 

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 

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