In a week of backwards steps for the Eurozone, UK banks have been hit with yet more bad press. This following miss-sold PPI the news that broke yesterday added more shame to the industry. This is the news that greedy traders in the banks have been artificially changing key figures that affects borrowing cost for companies and mortgage borrowers in a bid to make more money. The economical picture in the UK is generally bad as everyone is feeling and other news highlighted this again this morning. The data released by the National Statistics showed a worse than expected picture of growth with revised GDP figures. Q4 of 2011 was revised down to 0.4% rather than the previse estimate of 0.3%. While the economy contracted by an unchanged 0.3% in the first quarter of this year. The figures mean the current double dip recession in the UK (defined as two or more quarters of declining GDP in a row,) is more severe than first thought.
However as people looking at the currency market can see that the pound is currenctly very strong, especially against the Euro, but why?
The answer to that is simply, the Eurozone continually miss performs and the people in control of its destiny continually fail to introduce any confidence that things are changing for the better. Traders as a result are less likely to hold euros, selling them for the pound making and therfore making the euro cheaper to buy for you and I. They are currently held up in Brussels at their 20th emergency meeting since 2010 trying to introduce change. Even though it is likely that nothing significant will come out of it, we have to remember that it is in their interest to resolve the matter and it should be only a matter of time before they do, and when they do the euro should become more expensive! The real question is when will they move forward. For example if we knew it was two weeks away we would buy our euros beforehand of cause we would, right?
That is the crystal ball question that everyone is trying to forecast. If you are in that position, needing to move currency the easiest way to avoid disappointment is to buy before the markets move. There are a number of contract types that can be used that are not available from banks that could make your decision easier. For more information contact your currency broker or feel free to ask here. Either feel free to call on 01494-787-478 and ask for me Steve Eakins or email me directly at [email protected] quoting PEF in the subject title and I shall be more than happy to assist you both in terms of getting the best rate of exchange and a high level of customer service for your currency transfer.
So in summary, watch out for any news from Brussels this week, however slim. Plus the Bank of England Governor Mervin Kings who is speaking tomorrow morning at 10:30.