Pound Sterling Forecast

The Pound has once again had an encouraging week against most of the majors as confidence in Sterling is still fairly high – Even with a technical recession hanging over our heads investors seem to be able to see past that and in my opinion the U.K is being seen as “The best of a bad bunch” hence the minor confidence and strength in the Pound.

French elections will weigh heavilly on the Euro over the weekend, and the pending results may lead to an extremely volatile start to the week for those buying or selling Euros. Many of my clients I speak to in France believe that there looks to now be only one winner, and his relationship with Angela Merkel is about as solid as North and South Korea, so if he is elected expect fireworks for the European Debt crisis in the coming months.

Today is fairly important for those with a Dollar interest and indeed interest in the ‘riskier’ currencies such as the Australian Dollar, New Zealand Dollar and South African Rand. Non Farm Payroll data is essentially the number of people in Non agricultural employment over in the States and is a key indication as to how their economy is performing.

The reason it is Non agricultural is because these jobs may be seasonal and do not give a fair representation of the employment figures. The reason it can cause quite a lot of volatility is because predictions are made in advance and these can be wildly out… As many of our regular readers will know the markets move onb rumour as well as fact, and should the figure come out quite a way from predictions the market does correct itself rather swiftly.

The reason this effects the AUD, NZD and ZAR and pretty much most majors is because as i’m sure you can imagine it will effect attitude to risk and will lead to rapid movements of large amounts of money globally in what generally presents a volatile end to the week.

If you have a currency transfer to carry out either now or in the coming months and you would like me to personally assist you and get you a better rate than your bank or current broker then email me directly djw@currencies.co.uk – I now receive 30,000 unique visitors per month to this site and if you are finding it useful and of interest then why not get in touch and see how else I can help?

I look forward to speaking with you soon, and for those in the U.K enjoy your Bank Holiday weekend

Sterling has continued its recent resurgence hitting a 33 month high against a basket of currencies on a trade weighted basis. This has included a notable high against majors such as the Euro (a 22 month high), US dollar (7 month high), AUD and NZD (year highs). To me these must represent some fantastic buy opportunities and may well come as a welcome relief to many. For those with an upcoming requirement involving Sterling watch out for UK PMI for the services sector at 09:30. The PMI service released by both the Chartered Institute of Purchasing & Supply and the Markit Economics is an indicator of the economic situation in the UK services sector and captures an overview of the condition of sales and employment. Figures above 50 show expansion and below contraction, we are expected a release of 54.2 showing expansion but these would be down on April’s figure of 55.3 so may cause the pound to weaken a touch. We have also seen Nationwide house price data released overnight with figures falling from 0.5 to -0.2% – possibly why the pound is down against most currencies this morning.

ECB Interest Rate Decision

For anyone with an interest in the Euro keep an eye on the European Central Bank and their respective interest rate decision at 12.45BST. Expectations are for a rate hold at 1% but the press conference held by President Mario Draghi at 13:30BST should be viewed with caution. I am sure the situation in Spain will be high on the agenda and clues may be given as to future monetary policy and as to what the ECB projects for the coming weeks and months. Should Draghi take a positive (bullish) tone watch for Euro strength in the afternoon session. Subsequently any negative sentiment and expect the reverse. The period before and after the Presidents speech is a notoriously volatile time, anyone risk averse may well look to avoid this contact Mike at mgv@currencies.co.uk to discuss your transfer and the potential outcomes.

As a specialist currency broker myself and a number of my colleagues regularly post on this blog to assist and help individuals and business’s a like make an informed decision as to when is best to exchange. Through years of market experience we get a feeling as to what data sets affect the market and can help pass this market knowledge on to prospective clients. Ultimately the decision is always yours but should you have an upcoming requirement and would like to run through the data that might affect your exchange in the coming weeks then please do not hesitate to contact me. As well as taking time to write and post on this blog I also work for one of the UK’s largest independent brokers www.currencies.co.uk offering a number of contracts tailored to each individuals requirements. I would be more than happy to discuss these contracts with you and can be reached on 01494 787 478 or email Mike at mgv@currencies.co.uk

GBP/EUR levels have managed to push their way back above 1.23 during Tuesdays trading, halting yesterday’s suggestions that the euro was beginning its fight back. There was thought amongst some analysts that the recent highs sterling had been achieving were about to dwindle away and during Monday mornings trading this opinion looked to hold some weight. Levels briefly dipped below 1.22 but just as quickly fought back and by mid-afternoon  had surpassed the 1.2250 barrier. They pushed on again today and at time of writing were sitting at 1.2303, providing some of the best buying opportunities of the past two years.

In my opinion this is more proof that the Eurozone and its single currency still have a long rocky road ahead. The Spanish debt crisis could be compared to a sleeping beast and one that we can be sure European leaders are trying to keep sedated. There is a real fear that any Greece style bailout, if required, would cripple the EU, the current bailout fund and ultimately its individual economies.  The French presidential elections are also causing some concern amongst investors, who are worried about the consequences of current front runner Francois Hollande being appointed, due to his anti-Europe opinions.

For this reason I cannot see the euro pushing below 1.20 based on the current economic climate, both in the UK but more importantly in Europe. I also feel there will be resistance met at 1.24, as the markets wait for further information to decide which way they will move next.

If you have an upcoming currency requirement or would like to discuss current market trends then please feel free to contact me directly at mtv@currencies.co.uk or on 01494 787 478.

Following better than expected mortgage approval data and not too terrible PMI (Purchasing Managers Index) data we have seen Sterling have yet another gravity defying start in early morning trading.

The Pound is up against pretty much all majors, not by a huge amount but it is still up. Personally I feel that the sudden confidence in Sterling is due to it now being the best of a bad bunch…. Surely any investor with their head screwed on would be wary of the Euro at present and with the potential of QE3 hanging over the head of the Dollar the Pound surely steps forward… Even if we are technically in a recession at present.

The question really is how long will this last??? We have seen Sterling have a few decent spurts like this over the past few years, yet only ended up disappointed with it fizzling out thanks to poor negative movements from the Bank of England who seemingly get twitchy when the Pound gets too strong.

The sensible option in this market is to use a Stop Loss order… This is where you set yourself a worst case scenario in the market e.g 1.22 – If rates should start to drop[ away and that level become your trading level even for a second then your currency is automatically purchased for you, however the order (as long as it is not filled) can be moved at any time so if rates are creeping up you can always ‘chase the market’ up and keep increasing your bottom figure.

The good thing with this is that you know what your worst case scenario is for example the minimum your Euro purchase will cost, the bad part is if the market should jump down to the point your currency is bought and then fly back up again then you have secured your currency and the deal is done. For the less riskier client though this is ideal as you do get to see how the market pans out without losing too much if the market should drop away.

If you want more information on this then feel free to contact me directly djw@currencies.co.uk

The pound lost slightly today in early morning trading due to PMI Manufacturing data coming out worse than expected. The figures still pointed to a sector in expansion, but were not a strong as predicted. This release makes tomorrow and Thursday’s PMI data key for anyone buying or selling the pound this week.

These PMI (Purchasing Managers Index) surveys are a snapshot of the relevant sector and provide the most up to date information relating to an economy. They are of course not definitive, but for anyone looking to make a transfer this week or month, they could well set the pace. Don’t forget technically the UK is in recession. The next revision is not until 24th May, but with the currenct estimate at -0.3%, will take quite some upgrading to boost the UK’s current outlook.

Tomorrow at 09.30  we have UK PMI Construction. Construction was the sector that apparently dragged the UK down last quarter and it is expected that this sector like Manufacturing this morning will be slowing down. Tomorrow morning we also have German PMI Manufacturing and German Unemployment. As the biggest Eurozone economy this is well worth being aware of if considering a Euro trade. We are still at close to a 20 month high buying euros with sterling but these data sets could easily change the course for the day.

On Thursday at 09.30 we have UK PMI Services. As with today and tomorrow’s PMI data the Service sector too is expected to be slowing down. As the key concern for the UK is growth, further negative news could really hamper the pound and even cause it to lose value. Thursday afternoon sees the ECB (European Central Bank) rate decision which could well stoke some movements on GBPEUR and EURUSD. And talking of the dollar, we have perhaps the biggest release of the week on Friday with US Non – Farm Payroll. This can move the market on all currencies as investors move money according to what they think may happen. If you are making or considering any currency exchanges it really is worth being aware now of what may happen so you do not miss out.  Exchange rates move every few seconds and we can help not only limit your exposure using our wide range of contracts options and making sure you are up to date with the latest movements, but also make sure your trades go through at the very best commercial rates, above that offered by other brokers and banks. Feel free to make a comparison with anyone of the team directly or by using the contact form on the right hand side. We always go that extra mile for clients who contact us via this site!

And I must say Congratulations go to Daniel for some excellent predicitions yesterday! This just goes to show how by listening to us clients can save money. Of course there are no guarantees but because of our inner knowledge of what actually drives exchange rates we can make what can turn out to be pretty accurate predictions.

As well as the above data there are many more releases concerning the USD,  AUD,  NZD and CAD! If you would like any further information I will be happy to personally assist. You can call me direct on 01494 787 478  or if you prefer email via jmw@currencies.co.uk

We look forward to hearing from you

If you need to make a transfer into a foreign currency then now may be the ideal time to seriously consider your options. The Pound is the highest it has been against a basket of major currencies for over 32 months and with the fact that the U.K is technically in a recession you just cannot be too sure that these gains can continue.?!

Sterling Euro

With Spain notably in quite a lot of trouble and plenty of political problems within Europe you would imagine that the Euro is still in for a rocky period. Indeed all the signs are there that the Europeans will struggle in the coming few weeks and pressure will mount. There is no smoke without fire and I’m sure there is a lot more to come out from behind closed doors in the coming few weeks however do be wary.. Rates against the Euro at points today have been the best in 22 months and it is usually those that are greedy and hold out for that little extra that get their fingers burnt.

Sterling Dollar

TheDollar has also weakened of late following negative comments from the Federal Reserve in their latest press conference. Interest rates are set to stay low until 2014 and there is still the potential for further Quantitative Easing which may weaken
the Dollar. Beware though, in times of uncertainty globally (which we would see if European problems kick off) investors tend to run to the Dollar as a safe haven and the Dollar generally strengthens. Gold is also a safer haven and priced in Dollars so this may also increase demand for Dollars making the Dollar gain back ground.

Sterling Australian Dollar and New Zealand Dollar

A potential interest rate cut in the near future may weaken the Australian Dollar once more (an interest rate cut is generally seen as negative for the currency concerned). The Australian and New Zealand
Dollar have both had a tougher time lately as in times of uncertainty investors tend to avoid these ‘riskier’ currencies. Couple that with China slowing down ever so slightly and we may have a little more weakness to come.

Are you getting the best rates of exchange and level of service at present? Do you even compare?

If the answer to any of the above heading is no then I can help you… Even if you just want a quick comparison to ensure that you aren’t losing money on your currency transfers I am happy to give you that. Feel free to email me directly djw@currencies.co.uk having spent years working on the currency markets I can help you both in terms of getting great rates and with timely market updates to help you decide just when to book your currency as even the smallest movement in your favour can make quite a big difference in what quite simply are extremely volatile times.

Credit rating agency Standard and Poors have knocked down Spains credit rating another two notches to BBB+. With Spanish unemployment nearing 25% and the economy looking in great danger of becoming Greece the part two….

Spain now appears that it may be the next weight piled on the European Central Bank’s shoulders in the coming weeks and months and as mentioned before this is a much bigger situation than we have had previously and will indeed make confidence in the Euro extremely low.

If you have Euros to sell then it may be prudent to look at all the options available to you fairly quickly, if you are in the process of selling your property overseas then a forward contract may be the right option, this is where you can lock into a rate of exchange for anything up to two years in advance for just a small deposit… The deposit can indeed be taken in another currency if you have no access to Euros at this time. Email me directly if you would like more details on this djw@currencies.co.uk

U.S GDP data today

Todaywill see the release of U.S GDP figures to round off what has been a reasonably volatile week on the currency market. This data release can lead to volatility for all major currencies with the U.S being a key indicator as to how the entire global recovery is going as a whole. Poor figures could lead investors to be a little more risk adverse which may lead the them pulling out of the riskier currencies such as the AUD, NZD and ZAR meaning that they weaken and are cheaper to buy. Should U.S figures be much
better than expected it may lead to investors being more prepared to take risk and these particular currencies may become much more expensive to buy. If you have a pending currency transaction to carry out then feel free to contact me directly as I can save you money by getting you a better exchange rate and save you time and hassle with a proactive and high level of customer service too. Email me today djw@currencies.co.uk

You can protect yourself from adverse market movements by
using such tools as a stop loss order or forward contract, contact us today on
0800 328 5884 if you would like a more detailed explanation on how these work.

Yesterday’s GDP figures indicated that the UK’s economy is not quite as far out of the woods as some senior officials would like us to believe. This figure came as somewhat of a surprise, considering in general UK economic data has been steadily improving since the start of the year. Following the release of these figures the EUR saw sharp gains against sterling, pushing levels back down through 1.22 and for a while it looked as if it may continue on, eroding the fantastic buying opportunities we have seen of late.

However, by late afternoon this spike had been erased and GBP had not only moved back through 1.22 but surpassed the levels of the previous day, reaching a peak of 1.2277. In my opinion this proves just how little faith investors currently have in the single currency and the well documented problems not only Spain but across most of the EU region, mean that any move back through 1.20 is unlikely in the short-term. We also need to remember this was only the initial figure and it is due to be revised twice over the coming months, so don’t be surprised if the ‘recession’ we have re-entered is short lived.

GBP/USD levels continue to hold firm above 1.60 and today even touched briefly on 1.62, before falling away during afternoon trading. The greenback is suffering from a string of positive data in the US, including a fall in unemployment figures and a faster growth rate than predicted. This would usually indicate strength for a countries currency but as I have written previously the USD is often used as a global barometer, meaning poor economic growth leaves investors running for the relative sanctuary of the Dollar.  On the flip side an upturn in the global economy (often based on data released in the US) means investor’s appetite for risk increases and they move away from the safe but usually low yielding USD and will invest in riskier currencies such as the ZAR or NZD, which fluctuate more and therefore offer more chance of a higher yield. US GDP figures are released tomorrow at 12.30 and any variation from the 2.3% prediction could see  movement for GBP/USD.

If you have an upcoming currency requirement and would like the opportunity to access award winning exchange rates then please feel free to contact me directly at mtv@currencies.co.uk or call me on 01494 787 478.

We saw surprise figures out for the U.K yesterday that many analysts and indeed everyone who writes for me on this site were not expecting. With such a negative release just why has the Pound managed to continue its rally against the majority of majors?

The figures released yesterday do not include all of the data for the first quarter of 2012, and are due to be revised twice in the next two months and by the look of things we could quite easily see these figures revised back up again in these revisions, as the majority off the data already out is construction based and there is still an awful lot of more positive data to be included.

The Federal Reserve last night carried out their monthly interest rate decision and press conference following it and managed to weaken the Dollar once more which has led to over 5 month highs for those looking to buy Dollars or AED as this curreny is indeed pegged to the U.S Dollar.

Personally, I still feel (and I know I seem to always be positive) that the Pound will have a good year this year… We may not see rapid strength but I would not be surprised to see it continue to creep up against the majority of majors, maybe taking a slight knock along the way. By no means do I expect to see us reachj the dizzy heights of a few years ago yet as there is still a huge amount of work to be done.

If you have a pending currency transaction to carry out it may be prudent to get in contact with me directly, I have worked in the industry for years and carried out currency transactions for thousands of clients, saving them money over their bank and/or current broker whilst offering an extremely efficient and proactive service. If you wish to get in touch email me directly leaving a brief message and contact number on djw@currencies.co.uk or if you are a long way off needing help then feel free to join our mailing list by filling in the form on the top right hand corner of this site.

Sterling exchange rates have fallen this morning following the release of Q1 UK GDP in which the UK economy has posted negative growth for two consecutive quarters officially bringing the UK into recession. This is the first time this has happened since 2009 and was a little surprising with early forecasts suggesting the UK would just scrape through into positive territory at 0.1%. Following the release the market reacted immediately with the pound losing 0.5% against most major currencies. But what now for the pound?

GBP/EUR

Following the positive showing from the pound yesterday with levels reaching a 20 month high at 1.2277 the market has quickly fallen below the 1.22 mark highlighting how quickly levels can fall away. Many clients that have waited for the market to continue to rise have had a nasty surprise this morning following the UK GDP data release. The difference in the space of less than 24 hours on a £200k transfer to Euros is €2,280 when compared to the high and low, indicating just how important it is to be in a position to strike should a spike occur, as more often than not they are short lived.

To be honest I am a little surprised at the data set this morning as recently the UK had been coming out with some much more positive data of late and I genuinely believed a positive figure would have been shown. Yes there is an argument that the political uncertainty in Europe with the ongoing French elections could hamper the Euro, however I do fear this could now be the start of a short term slide and we could easily see levels back towards 1.20 and beyond. Should you be looking to buy Euros in the short term and are worried the market might slip away then e mail Mike at mgv@currencies.co.uk to discuss your options. We have many clients utilising forward contracts and locking in on their exchange for a guaranteed delivery in the future. This contract enables you to lock in a price for up to two years in advance for a nominal deposit and thus avoiding the market uncertainty. Contact me today while the market is still above 1.21 should you wish to buy Euros.

GBP/USD

As with GBP/EUR, GDP data this morning has hampered the pounds recent surge against the greenback. Cable levels earlier this week hit a 6 month high at 1.6170 but has dipped below 1.61 this morning. This week continues to be a busy week for the dollar with the Federal Reserve releasing its latest interest rate decision this evening. Rates are expected to stay on hold at 0.25% and this is unlikely to drive the market too much, although watch out for the press conference held afterwards for any insight into future directions for monetary policy. More importantly from my point of view for anyone with an interest in the dollar, you should keep an eye on US GDP data on Friday. As with the the UK data today, this could have a major impact on short term moves for the dollar, expectations are for a fall month on month from 3% to 2.6% and any deviation from this is likely to cause volatility.

GBP/NZD

Sterling has posted some of strongest gains of late against the kiwi gaining over 10 cents or 6% since February, a difference of over NZD$24k ond  a £200k transfer during this period. Again being a benefactor of riskier trades due to its higher interest rates, the kiwi could well benefit should economic confidence return to the market. Should the US post better than expected GDP data on Friday this could well lead to a surge into riskier currencies such as the NZD, ZAR and AUD through the use of a carry trade. This is where clients borrow in a low yielding currency such as the JPY or CHF and will purchase currencies offering much greater yields to benefit from the increased returns. This is a risky strategy and will often take place during more certain economic periods and with the US acting as a global barometer better growth figures may lead to an increase in demand for these trades and hence a boost in demand for the kiwi, of course the reverse could happen should the data be poor!!

Other data of note for the kiwi will be the Reserve Bank of New Zealand interest rate decision later this evening – expected to stay on hold at 2.5% but any comments from the central bank following this could cause volatility, keep an eye on the release at 10:00 BST.

Should you wish to discuss any of the points raised in this blog and to discuss the contracts options available to then please email me at mgv@currencies.co.uk or call on 01494 787478