Category Archives: Sterling strength
Sterling Euro rates have seen a big gain this week following the best UK retail sales data in over ten years.
Thanks to the effect of Black Friday consumers spent a lot more than expected and the data showed growth of 6.4%.
Wage inflation is also now rising faster than inflation for the first time since 2008 so this week the British economy looks in very good shape.
Sterling has broken through 1.27 yesterday and this look set to remain at around these levels for the time being with little data out for both the UK and Eurozone today.
Next week sees the release of UK GDP data for Q3. If it is revised downwards we could see Sterling fall marginally against the Euro so it may be worth taking advantage of this spike on Monday prior to the announcement.
Also bringing the Euro down is the issue with the Greek government. All eyes are now fixed on what is happening with Greek politics. If the Syriza party is voted in they have promised to challenge the bailout terms set out by the ECB previously which could cause instability and cause the Euro to weaken.
If you have currency transfer to make prior to Christmas and want to save money on exchange rates when buying Euros compared to using your bank then contact me directly for a free quote. Tom Holian email@example.com
GBP – EUR
Sterling has seen a very strong move in its favour today as UK Retail Sales came much higher than anticipated. This could be due to the rush to buy reduced price goods on ‘Black Friday’ however one would feel that the markets would have anticipated this. There has been a swing in favour of nearly 1%, which for GBP EUR is substantial. With UK Public Sector Net Borrowing out tomorrow morning and UK Consumer Confidence, if both are Sterling favourable then it wouldn’t be out of the question to forecast GBP EUR north of 1.28. Euro Sellers should be looking to have their positions sorted prior to the ECB Quantitative Easing arrival in early 2015 – this could trigger a GBP-EUR level north of 1.30. If you don’t / can’t wait that long, Euro buyers should potentially look to trade if rates push above 1.2750, as although a further push is expected – levels are at near 3 year highs!
Sterling has finally made the gains against CHF expected late November 2015. The Swiss Central Bank cut its deposit rate in an effort to curb the CHF. It’s primary aim is to keep CHF-EUR levels above 1.20 to encourage trade with the Eurozone. However it comes at a cost against all other currencies. GBP CHF has moved nearly 1.5% in favour of the pound today. It was previously reported on this site that a strong GBP push against CHF was to be anticipated, it has just happened about 14 days later than expected! If you have a CHF purchase requirement 1.54 should potentially be available at the current growth rate, however once again it could depend on Sterling not losing ground tomorrow morning. If you have CHF and haven’t sold them already, I’d be looking to sell them sooner than later. As EUR CHF has only lost half a cent so far, I’d anticipate further bad press to weaken the Franc further.
If you have a currency exchange requirement, please feel free to contact me direct to the trading floor on 01494 787 478 or via email AJB@currencies.co.uk
I can assist with the most regularly traded currencies, not just those mentioned above!
I look forward to hearing from you…
Sterling has rallied against both the EUR & USD over the past 24 hours after some early week losses. GBP/EUR rates have spiked back above 1.26 following the release of the latest Bank of England (BoE) minutes. These came out as expected and showed that 2 members still voted in favour of an interest rate hike, with 7 members voting against this. The only negative was that UK unemployment came out slightly worse than expected at 6%, although this was countered by a rise in UK wages.
The key question for many investors is whether GBP/EUR exchange rates will hit 1.30 and in my opinion this is not likely in the short-term. The EUR continues to find support in the higher 1.20’s and I believe it will continue to do so, although I cannot see GBP slipping significantly from its positon under the current market conditions.
The Pound has also found support against the USD and has moved back above 1.57 on the exchange during Wednesday’s trading. This move is in contrast to the recent trend of USD strength and has brought some respite to those clients looking to purchase USD. Personally I still feel a move back towards 1.55 is likely early next year, so I would still be tempted to consider my position round 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 directly on firstname.lastname@example.org
The Pound vs Euro is in for a very big day tomorrow as there is a whole host of economic data due out in the morning which could impact Sterling exchange rates.
The Bank of England releases its minutes from the December meeting and the expectations are for a 7-2 vote in favour of keeping UK interest rates on hold. Closely followed will be UK unemployment data in the form of the Claimant count which shows how many people are claiming benefits. The expectation is for 2.8% so anything different could cause exchange rates to move.
Eurozone inflation is released at 10am tomorrow and this is likely to be the key data release of the day. With inflation having fallen for the last few months in Europe the ECB has cut interest rates in September and intervened with monetary policy in October in an attempt to curb further falls in inflation
This is rather detrimental to the currency involved which is why we saw a 2 year high for GBPEUR rates a few weeks ago. Eurozone inflation is expected to be 0.3% so anything lower could see Euro weakness tomorrow.
As we head into tomorrow evening all eyes turn to what is happening in the world’s leading economy. The US announces their own set of inflation figures which could strengthen the Dollar.
Closely followed will be the Fed’s interest rate decision and any hints of a rate hike could see the Dollar strengthen against Sterling.
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 email@example.com
Will sterling continue to climb in the New Year or fall against its peers? This is a very valid question at this time and with rates at such interesting historical levels begs the questions, what will happen towards the end of the year?
The most important day for sterling is probably tomorrow with the Bank of England Minutes form their latest interest rate setting meeting plus Unemployment data also released. The rate has held fairly firm at 6% on the Unemployment rate which is encouraging as a sign of the UK economy finally getting back on track. The rate had however been falling and it might be that with other economic data showing not such great performance any lack of improvement in the figures is seen as damaging for the buoyant pound.
This really does appear to be the most important event on the calendar this week and before the end of the month so if you are considering moving sterling not just before the end of the year but also in 2015, it really might be sensible to make some careful plans now. Two years ago sterling was at 1.25 against the euro approaching Christmas before falling to 1.14 by February and March!
By making us aware of your transfer and any possible target rates we can work together to try and help you get the most from the market. Should you wish to learn more please contact me Jonathan on firstname.lastname@example.org. Merry Christmas!
If you read my previous article about falling oil prices you’ll have an understanding as to how much of an impact this can have on exchange rates.
With Russia cutting interest rates and the Rouble falling through the floor this is also having a big impact on exchange rates in both Sweden and in particular Norway.
Sterling vs NOK rates have moved by over 5% this morning and in the space of the last ten minutes GBPSEK rates have moved by 1%! This makes a huge difference to the amount involved and can mean the difference of actually being able to afford the transaction.
Oil prices are now at their lowest level since July 2009 and are set to fall even further over the next few days with some analysts predicting a fall as much as US$40 per barrel. Currently the price per barrel is around US$60.
As Norway is such a large exporter of oil the falling price per barrel is set to have a dramatic effect on the exchange rate between Sterling and the NOK.
If you have a currency transfer to make and want to take advantage of the recent movements then contact me directly for a free quote. Tom Holian email@example.com
Staying within what seems to be its natural trading range, GBP EUR opened up comfortably within the 1.26 range. The Euro weakened after lunch yesterday following a brief stint within the 1.25 range. Essentially the Eurozone Central Bank had made nearly €1 Trillion available for banks to lend cheaply to their customers, but was not taken advantage of. This lead to the ECB announcing that full blown Quantitative Easing (QE) was a definite for 2015, leading to the Euro losing roughly the cent it had gained.
Looking forwards there is a lot of EUR GBP data out next week, primarily at the beginning of the week…
UK Inflation (CPI) 09:30 Tuesday, German economic sentiment 10:00 Tuesday, Bank of England Governor Mark Carneys speech at 10:30 (also Tuesday) and the minutes of the Bank of England’s most recent interest rate decision (Wednesday midday).
If you do have a currency exchange requirement that you’d like to get sorted before Christmas, please feel free to call me directly to the trading floor on 01494 787 478. I’m also contactable direct via email AJB@currencies.co.uk
2015 looks to have a lot of volatility from week one (UK Election speculation, Eurozone QE) – make sure you have eliminated as much risk as possible by using contract options available to you from an experienced currency broker.
The Pound flirted with the 1.25s today seeing a day low of 1.2570. This has been a welcome opportunity, subsequently taken advantage of by Euro sellers – these have been the best prices seen for just over two weeks. Sterling rebounded swiftly however as just after midday, the European Central Bank (ECB) announced that the cheap loans made available to European Banks had not been fully utilised. This therefore leaves the markets expecting the ECB to have no choice but to proceed with full ‘Sovereign Quantitative Easing’. QE is generally seen as negative for an economy so the fact that comments reinforce its inevitability push GBP EUR closer to 1.30.
Prediction – GBP EUR to hit 1.29 before the end of 2014
Sterling Aussie made strong gains at a similar to GBP EUR gains on the back of comments from Reserve Bank of Australia Governor Glenn Stevens. Stevens publically announced that he thought AUD was very overvalued, up to 10 cents overvalued against USD! This pushed GBP AUD north of 1.90 and will close the day there or there about. On 26th November my colleague Daniel Wright predicted 1.90 within the next few years – it appears he was spot on!
Sterling Rand has hit 18.29 for the first time since July – Is it the spike to take advantage of…
Feel free to contact me direct to the trading floor – 01494 787 478 – AJB@currencies.co.uk
If you need to make some currency exchanges in the New Year involving the pound, you should be very much aware of some volatility expected on exchange rates. It is important to note that making firm predictions is impossible but just like we predicted in the Spring sterling would rise against the major currencies towards the middle and end of the year we can now make a prediction in the New Year sterling is likely to fall. We cannot tell you exactly how much by or which date but falls of up to ten cents on GBPEUR and 15 cents on GBPUSD wouldn’t be completely out of the question.
How can you make such a forecast? Well primarily I am basing this one major event, that is the General Election. Political Uncertainty and Economic Uncertainty are two key reasons to sell the pound today. These two factors are likely to combine and undermine much of the confidence we have seen behind sterling in 2014.
Economic Uncertainty – The sums don’t add up. The UK is still spending much more than it receives in tax receipts which is ballooning the public debt. Much slower growth than forecast will obscure the Chancellor and the OBR’s (Office of Budget Responsibility) plans for the economy to heal itself through more tax income. The Eurozone is slowing down, China and the global economy are slowing down, where exactly will all this growth come from? The current plans set out by Mr Osborne some 4 years ago were well received by markets at the time but how much patience is there? How long will workers and business stand by the current government with no real signs of the improvements promised and discussed?
Headlines surrounding the lack of any major economic progress by the government are likely to dominate the New Year and this will in my opinion combine with Political Uncertainty to fuel a sell off on sterling.
Political Uncertainty - It is very rare the government of the day increase their share of the vote when challenging for a second term. This is because it is more than likely the government has lost popularity by nature of being in government and the opposition can pick holes in their abilities. The Tories whose laissez faire approach to economic policy is generally the favoured approach by the markets (versus the uncertainty of Labour getting us in more debt) will likely lose their hold on parliament and require further support in the form of another coalition. Will it be the Liberal Democrats? Unlikely, they have lost swathes of support in the UK. Will it be UKIP? They plan to leave the EU immediately which in the short term at least would be terrible for UK plc as business and government has to completely renegotiate international relationships.
The Tories are also talking about an in or our referendum on Europe. The prospect of the UK leaving the EU is potentially disastrous for the UK. Attitudes towards the UK as a centre for global business will deteriorate and we will, at least in the short term suffer from a loss of inward investment.
Labour’s economic plans are not well thought out and involve some fairly draconian measures which will ultimately limit competition and drive investment overseas.
When you look at how sterling reacted to the Scottish Referendum in September we are reminded of the potential for political and economic uncertainty to affect markets. If you need to make a transfer involving the pound in the New Year making some plans now might well be a wise move because what is very clear is that the market shave not yet factored in any of the issues outlined above as of yet. Whether this trend manifests in January or the week before the election is impossible to say. But holding on to find out is the risk and with the pound at such great levels compared to averages of the last five years, it would appear any decision to hold on too long may become very costly.
To keep up to date with market ‘spike notifications’ and ‘rate alerts’ or for a personal forecast for your situation please contact me Jonathan on firstname.lastname@example.org