It seems the only currency that Sterling had any gains against yesterday was on GPB/AUD, as rates for buying Euros (GBP/EUR) and for buying Dollars (GBP/USD), saw a fourth consecutive negative day in the currency markets.
This was seen most prominently in rates to buy Euros, which have come down by over 1% each day this week, and a total fall over the past 5 business days of nearly 6 cents.
The reasoning behind this hasn’t really changed since mid-December, it has simply become more obvious; the British economy is slowing.
Due to flooding and slowdown in global growth, alongside falling prices for commodities such as oil, growth forecasts for the UK have been revised downwards across most sectors – particularly for manufacturing, industrial and retail.
What’s most concerning compared to December is that we are also beginning to see a slow-down in the financial services sector as well, which has been hit for continuous slides in global stock and commodity prices. Mass sell-offs of shares is hitting the confidence in the UK financial sector to continue to perform and make-up for shortfalls elsewhere in UK GDP, which is translating into weaker confidence in the Pound.
George Osborne himself said that this would be the most difficult year for the UK economy since the financial crisis, and immediately his words have become prophetic since we’re only into the second week of February.
A global slowdown is not a short-term phenomenon, and particularly against the Euro the Pound is in for a difficult year with the Eurozone beginning to finally benefit from the emergency financial stimulus they introduced in January 2015. Their growth figures are up which is why Sterling has performed the worst against the Euro in recent weeks.
I strongly recommend that anyone with Euros or Dollars to buy in the short or medium term (3 months), should contact me on 01494 787 478 and ask the reception team for Joshua to discuss a strategy for your transfer in order to maximise your currency return.
Whilst the outlook is concerning, currency markets rarely move in a straight line, and opportunities may present themselves in the short-term after such significant movements. Any favourable exchange rates reached can actually be fixed to avoid further harmful movement affecting your transfer.
Anyone looking to purchase Sterling can do the same, and I will explain how best to ride any further movements in your favour expected to their peak in the time period you have to complete your transfer. [email protected]