Sterling losses we have been predicting manifested this morning with GBPEUR touching 1.3250 in early morning trading. Sterling to Euro buyers are the main losers in this one horse race as confidence returns in the Eurozone. Anyone holding sterling has taken a hit lately except for GBPAUD and GBPNZD buyers as worries in China feed through into these currencies weakening them. If you need to buy or sell the pound understanding what has driven the rate to these fresh lows is a good idea because if you are still looking at the market with 2015 goggles on you are likely to be misled.
The week ahead is not looking good for the pound
Thursday we have the Bank of England Interest Rate decision which I expect to cause GBP weakness. I predict that Ian McCafferty, one of the members of the MPC who has been calling for an interest rate hike will backtrack on this vote leaving the pound even weaker than it is today. If you are buying a foreign currency with sterling the transfer might be much more expensive towards the end of the week. If you are buying the pound this release might help you to get a better deal! For more information on the markets and all of your options please feel free to speak to me Jonathan by calling 01494 787 478 in UK business hours or email [email protected]. I am very confident I can offer you a better rate than other sources, if you are reading this and would like to learn more please contact me, what have you to lose?
The UK is this year or next likely to have a referendum on membership of the European Union. Some calls and reports suggest this could be as early as this summer! European Union membership is a very important feature of the UK’s attractive proposition to global investors. The uncertainty of the UK leaving this key position of global influence could have major ramifications for the future. If you are buying a foreign currency with sterling in the future the Brexit fears are something you should be taking seriously. There is a chance the UK will of course stay in the EU but the uncertainty in the future is leading to GBP losses. So think sensibly about what might happen. Even though you personally might believe that the UK will remain part of the EU, if you are buying a foreign currency with sterling in the next 6 month there is a very strong likelihood sterling will drop in that time frame.
How to mitigate risk
To mitigate the risk of buying currency you have the options to buy a forward contract. For a small deposit (loosely 10%) you can fix a rate on the total amount you need to buy fixing the settlement date (the other 90%) for the balance up to one year in advance. This is perfect for private clients buying property and businesses trying to manage their currency exposure as well. By fixing the rate now you will know exactly what you will be getting in advance allowing you to plan and manage your finances.
Buying foreign currency can be very daunting but it needn’t be. We are here to offer specialist and comprehensive information on financial markets to help you make an informed decision on when to make your trade. For more information at no cost or obligation please speak to me Jonathan on [email protected]. I am very confident I can offer you a better deal than other companies and the banks, if you find our information useful I am sure our exchange rates will also impress you.