Come on the pound!

Pound Euro falls after PMI Services Data in the UK

It is really getting quite annoying now just seeing the pound lose value week after week. I mean don’t get me wrong, we know why it is happening, but it just seems to have a real dampener on the general mood in the UK! Of course this is great news for anyone holding Euros (or another currency) and looking to buy sterling. But with the UK being a net importer (we buy more from overseas than we sell) a weaker pound has a net negative impact on the economy as it makes things more expensive.

This morning at 09.30 am is the latest Inflation report for the UK which could see some surprise movements. Whilst some of a more gambling nature might predict 1.12, I would not be overly surprised to see 1.11 on the back of any surprise good news. However with the likelihood to be a drop in Inflation the pound could easily drop below 1.10 again as are currently trading around 1.1040.

In my opinion I believe any spikes for Euro buyers are well worth capitalising on because the likelihood of sterling dropping remains very high. Overall the market is likely to drop more than it will rise in my opinion, the outlook before was the pound would eventually rise. However in my opinion the outlook has now changed and there is a stronger chance the pound will slide.

If you have a transfer to make in the future then making some plans in the advance is very sensible. Today and tomorrow’s UK data could be key to the short term movements, I believe the best short term strategy is capitalising on any spikes.

If you have a transfer to make in the coming months and weeks please speak to me Jonathan Watson by emailing jmw@currencies.co.uk.

Thank you for reading and I look forward to hearing from you.