A majority of traders had a hope that the UK Budget released yesterday would push up the value of the pound however we saw little impact. The growth forecasts being increased was probably the biggest impact on markets however as most other financial institutions have already raised forecasts it was fairly expected. Clients are asking why all the tax relief and investment that was announced did not push the currency markets around, the simply answer to this is to do with the time frames which these are planned to take place. Between now and then the government in power will probably chance following the election next year meaning the suggestions this week are very likely to have chanced between now and when they are implemented.
If you would like to discuss how yesterday’s data will impact your currency transfer feel free to contact myself STEVE EAKINS via my personal email address at [email protected]
Forecast for the next 7 days
Recently the only people smiling has been those looking to buy the Pound, as the value has fallen to their lowest against the euro seen this year. This is expected to continue this week with data tomorrow expected to both strengthen the single currency and weaken the Pound. It seems highly likely that we will end the week lower than where we are today. Next week however there is a host of economic data for the UK which I expect to swing the balance back in Sterling’s favour. Production Price Index figures are due on Tuesday, UKGDP figures on Wednesday and Retail figures on Thursday. If I was a GBPEUR trader looking to buy euros by the end of the month I would probably try and hold my nerve, try to ignore the loses we will probably see tomorrow, with an aim of getting a higher price next week.
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