Exchange rates for the pound have dropped sharply since 9.30 this morning as the markets had been pricing in the possibility of better than expected unemployment figures, and a boost from the Bank of England’s Quarterly Inflation Report. UK jobless figures only came out as predicted at 6.8% which is a 5 year low and the Bank of England raised growth forecasts for the UK, but the news wasn’t quite strong enough to support the huge optimism prior to the announcements resulting in sterling dropping back. Mark Carney was at pains to stress any interest rate rises would be very gradual and may stay at “historically low levels for some time” suggesting they are still a way off raising interest rates hence the dip in the pound.
Whilst this may be disappointing for clients buying Dollars, all may no be lost for Euro buyers. Tomorrow we have EU inflation figures which could be another big trigger for market movement. Low inflation has been a real cause for concern amongst members of the ECB, and should it come in on the low side again it could be the catalyst for the ECB to act as soon as their meeting in June and result in significant Euro weakness. If you want to make a currency transfer and want to get the best exchange rate then feel free to email Colm at [email protected] and I would be happy to help.