Poor UK Service Sector Data Halts Sterling’s Momentum (Matthew Vassallo)

Euro Suffers Losses to a Strong US Dollar and a Resilient Pound Sterling

Following the positive response created by the release of the recent UK Gross Domestic Product figures, you could be forgiven for thinking the UK economy had finally turned a corner. Yes we have moved out of recession for the first time in 2012 but today we were given a stark reminder of how fragile our economy still is and confirmation, if it was needed, that we do indeed have a long road to recovery. Today’s UK Service Sector data was the ‘weakest in almost two years’ and has halted GBP’s recent momentum. Rates were pushed back under 1.25, a level that has not been broken for the rest of Monday’s trading.

This market movement came about despite further concerns over Greece, who are currently putting together a new austerity package aimed at cutting a further 13.5bn euro of spending or face bankruptcy and France, who’s leader Francois Hollande  has been urged to cut labour costs to reform its flagging economy.

With concerns surrounding the economic stability of the eurozone likely to continue and the UK economy requiring a consistent run of positive data to back up the recent upturn, I feel the markets could stay fairly flat over the coming days. We are still likely to see spikes in both directions, which could provide both euro buyers and sellers

This market uncertainty can be difficult to digest, especially if you have an upcoming property purchase or sale and are looking to transfer funds but are worried that market movements will ultimately leave you short changed. Here at Foreign Currency Direct plc we have multiple contract types all tailored specifically towards our client’s needs. One of our most popular types is our forward contract, which allows you to lock in an exchange rate even if you do not have the full funds available. This is perfect for anyone looking to eliminate risk from the market but still take advantage of our award winning rates. If you would like more information please contact me directly at mtv@currencies.co.uk or on 01494 787 478.short-term opportunities for both euro buyers and sellers.