This morning the UK are set to release average earnings and unemployment rate numbers at 9.30am. At present average earnings is being outpaced by inflation which is a worry for the Bank of England, due to the stress on the UK public’s pocket. Average earnings is set to remain at 2.3%, however the trend over the last 12 months has been for average earnings to fall. If this continues I expect the pound’s good run could come to an end for a period.
Unemployment numbers are also set to remain at 4.3%, therefore this morning could be a non event. However Michael Saunders a member of the monetary policy committee from the Bank of England last week suggested unemployment over time is going to continue to fall, which should be good news for the pound. His prediction is for a fall to 4% by the end of the year.
In recent weeks the pound has been performing well against most major currencies. GBPUSD is at a 18 month high and is fluctuation close to 1.40 and GBPEUR is sitting at a 6 week high close to 1.14. The sentiment surrounding Brexit is far more positive than 12 months ago and the UK is producing good economic numbers, better than many predictions by forecasters.
Globally growth numbers are exceeding expectation and economists believe this is helping the UK economy along. Couple this with optimism surrounding Brexit my opinion 3 months ago has not changed and I believe that the pound is set to have a good year. This is good news for any client buying a foreign currency but bad news for people buying the pound. However, there is still opportunity. Did you know that if you convert euros into pounds now compared to before the Brexit vote, you are still receiving an additional 18 cents!
The currency company I work for enables me to buy and sell pounds at rates better than other brokerages and high street banks. If you are buying or selling pounds this year feel free to send me the currency pair you are trading (GBPUSD, GBPEUR, GBPCHF etc) the reason for your trade (company invoice, buying a property) and I will email you with my forecast for the currency pair [email protected].