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Sterling’s Struggles Continue (Matthew Vassallo)

By
Matthew Vassallo
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Pound Sterling Forecast – Will the Pound Weaken Ahead?

Sterling’s struggles have continued this week and despite a slight recovery against the USD, the general trend has certainly been negative. The downward spiral coincided with the start of 2016 and the Pound has failed to replicate the good feeling of last year and this has been reflected in the current exchange rates.

GBP/EUR rates have dropped below 1.30 today and as I’ve discussed in previous posts, this is a key resistance level for the Pound. If we see another aggressive move for the EUR the Pound may struggle to break back through it and whilst my underlying feeling has been that the Pound would start to find some support, the current trend is concerning for those clients holding GBP.

It is slightly better news for those clients looking to purchase USD, with the Pound fighting back over the past 48 hours. The pair is floating around 1.45 having spent most of last month closer to 1.40. Poor employment figures in the US have helped to stem the flow but based on the current economic climate in the UK, I am not anticipating this positive spike to continue. As we move through the year we may see Sterling improve, as the US elections are likely to cause some uncertainty and the hope for those clients holding GBP is that 1.40 will provide some protection if the rates do start to drop again.

Much of the focus this week has been on the UK and with key data releases yesterday, investors were dubbing it ‘Super Thursday’. Unfortunately it was anything but and the Pound suffered as a result. The Bank of England’s (BoE) UK Inflation Report made for grim reading and with BoE governor Mark Carney cutting growth forecasts in the UK, I’m not expecting a major improvement for Sterling in the short-term.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 725 353 and ask one of the reception team for Matt. Alternatively, I can be emailed directly on mtv@currencies.co.uk

Pound sterling exchange rates may well get much worse!

By
Jonathan Watson
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Pound to Dollar Forecast: GBPUSD Continues Upward Trend but for How Long?

The pound has sunk to fresh lows this week in response to uncertainty over the Brexit impact and fears the Bank of England will embark on fresh Interest Rate cuts and even Quantitative Easing in the coming weeks and months. The potential for the pound to slip by a further 4-5% should not be underestimated. I would be very surprised to hear if anyone would be calling the recent lows we have reached a bottom, particularly if we see the movements the markets have been expecting.

The biggest problem in the last few years is low interest rates globally, could the Bank of England be in to cause some shock and awe on financial markets. These events should not be personal but with Mark Carney being singled out by the Leave camp for being too noisy about the potential downsides for the UK economy, he might surely now have a bit of an axe to grind. Of course it would be crazy to suggest the Governor of the Bank of England would act without firm reasons but he must have been annoyed at the suggestions he was interfering with the Referendum.

If you have a transfer to consider making some firm plans in advance is vital in this market. Sterling slipped down to almost parity with the Euro when the Bank of England last cut interest rates. If you need to buy or sell pounds it is vital you understand the full implications of what is happening at present. For more information at no cost or obligation please contact me Jonathan on jmw@currencies.co.uk.

Sterling has in my opinion got further to fall so please speak to me about getting some helpful information and an exchange rate I am sure will save you money.

GBPEUR rates highest since January 2013 (Tom Holian)

By
Tom Holian
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Pound Sterling Forecast – Will the Pound Weaken Ahead?
Tom Holian
Tom Holian

Following the release of this morning’s UK Claimant Count which showed UK unemployment is now at 7.1% this has sent Sterling Euro rates to their highest level since January 2013. Coupled with the release last week of UK Retail Sales which were the highest since 2004 optimism is now surrounding the British economy.

Indeed, with the Bank of England having commented previously that UK interest rates are unlikely to be changed until we see unemployment lower than 7% this could see an interest rate rise needed sooner than first predicted.

The previous prediction for putting up interest rates according to a recent BBC poll was for no earlier than 2015 but personally I’ve felt a predicted on previous posts that I think we’ll see an interest rate rise before the end of 2014.

The news this morning also sent GBPUSD rates to their highest level in three weeks breaking through 1.65 on the mid-market level. The Bank of England minutes which were also published this morning showed a 9-0 vote against raising rates.

With inflation having hit the government target of 2%, UK house prices rising and unemployment falling this is all leading to Sterling’s strength. However, do be cautious as if GBPEUR exchange rates continue to rise at their current trend this could have a negative effect on the UK economy which is heavily reliant on its export market. This time last year when GBPEUR rates were similar we saw a big fall within a matter of weeks. the move was as much as 8 cents or the difference of £5,600 on a currency transfer of €100,000.

If you are worried about exchange rates and want to save money compared to using a bank then contact me directly Tom Holian teh@currencies.co.uk

UK Inflation Falls to 1.7% (Matthew Vassallo)

By
Matthew Vassallo
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GBP Holds Firm as UK Delivers 2020 Budget After Emergency Rate Cut

UK inflation figures were released this morning and showed a fall from 1.9% to 1.7%. This is the second consecutive month that figures have been below the BoE’s target rate of 2% and will help to reaffirm belief that the UK economic recovery process is gathering pace. Whilst this is a positive for the UK, the Pound has fallen away from the highs we witnessed a couple of weeks ago against the EUR, USD and AUD. GBP/EUR rates have slipped back below 1.20 and it will be interesting to see whether today’s data can help push rates back through this level.

Anyone with a GBP/EUR requirement should keep a close eye on Thursday’s UK Retail Sales and Friday’s GDP figures, both of which are likely to be key market movers. If Friday’s GDP figures vary from the 0.7% predicted, then it likely we will see additional volatility on GBP/EUR exchange rates.

GBP/USD levels continue to float around 1.65 on the exchange and despite an improvement in the US economy the USD is still struggling to make a decisive move back towards 1.60. The USD did start to strengthen towards the end of last week, after head of the FED Janet Yellen’s first official press conference since taking her position. She indicated we could see a potential rate hike within 6 months and although this was taken by some with a pinch of salt, it did seem to breathe life back into the USD, as markets reacted positively following the announcement. With positive data expected for the US economy on Wednesday, we could see further USD gains before the end of the trading week.

If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our rates with your current provider, then please feel free to contact me directly at mtv@currencies.co.uk.

Cameron vs Miliband – Exchange Rate Forecast – ( Andrew Bromley )

By
Daniel Wright
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Pound Increases Against the US Dollar Despite Falling Inflation

Euro buyers had a shock window of opportunity yesterday evening, with that window still currently slightly open…

After poor UK export data this week analysts have predicted an artificial weakening of the Pound, in order to kick-start sales of goods to our Eurozone counterparts. As the Euro has been the weakest major currency and our key trading partner – we’ve suffered as a result. Mark Carney (Governor of the Bank of England) is in Frankfurt this morning, discussing all things debt. Although no surprises have surfaced, Carney has mentioned that he thinks the next Interest rate move will be an increase, strengthening the Pound.

I personally would be inclined to take advantage of this spike, as the short to medium term future for the Pound looks bleak. Cameron vs Miliband last night shows a genuine start to the political timeline, with the pound expected to start falling shortly. Parliament breaks for the Election from next week so expect the slander to begin!

 

The US Dollar has had a very rocky past week, as speculation is still rife for both a summer and autumn interest rate hike! Janet Yellen (Chair of the US Federal Reserve) indicated that an April rate hike wouldn’t happen, however couldn’t rule out a hike in June. I personally think that the overwhelming direction for the Dollar is positive – good news for Dollar sellers!

If you’d like to take advantage of the current market positions, even if you don’t have full funds available now, I can help! Booking your exchange rate for say a property purchase in the future can be a very wise thing to do, as the last thing you want is for the market to crash and you can’t afford the house! Feel free to contact me on 01494 787 478 or email me directly AJB@currencies.co.uk

 

Will the pound continue this run of form?

By
Jonathan Watson
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Pound to Dollar forecast: Sterling continues to decline against the US Dollar

The pound has been performing very well this week, principally on the back of greater expectations of a Brexit that isn’t quite that bad. Whilst there is still tremendous uncertainty over what lies ahead the pound is now at levels against some currencies, similar to where it was before the Referendum. This has been most pronounced against the US dollar but the pound is faring well against pretty much everything this week.

Of course, the euphoria which has been in part driven by the ‘best of a bad bunch’ mentality, ie the pound is doing well because investors prefer holding sterling instead of the US dollar, shouldn’t last too long. Soon enough the Brexit realities will hit home as discussions over trade talks and also the transitionary period commences.

If you are buying a foreign currency with the pound taking advantage of this spike is I believe well worth it to avoid the uncertainty and potential losses of holding on too long. If you have a transfer to make buying sooner than later on the back of this good news could be the smart move.

Next week sees key news from the US Federal Reserve Bank which might well trigger movement on the global currency markets. Any sign the US economy will continue to perform well and the US Fed are raising rates, could trigger US dollar strength which may see funds come out of the pound.

If you need to buy or sell the pound in the coming week highlighting your position sooner than later could be a smart move. For more information on the latest trends and themes concerning the pound and how to benefit from the volatility please speak to me Jonathan by emailing jmw@currencies.co.uk.

 

Sterling under pressure against the Euro even with positive UK GDP figures (Tom Holian)

By
Tom Holian
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Pound Sterling Forecast – Will the Pound Weaken Ahead?

Sterling Euro exchange rates have fallen yet again even though UK GDP figures came out better than expected yesterday morning. This was the first quarter after the Brexit vote and although the figures were good the gains were very short lived for the Pound vs the Euro.

The real issue for the Pound is that it’s likely to remain under pressure for quite some time owing to the political instability surrounding the announcement of Article 50. Since the start of October we have seen GBPEUR exchange rates fall by as much as ten cents from the high to the low and in such a short space of time this is very concerning particularly for anyone looking to send money to Europe.

Bank of England governor Mark Carney and deputy governor Ben Broadbent have also recently spoken about the value of Sterling and have not shown too much concern so with the Bank of England due to meet next Thursday I think we could even see an interest rate cut happen.

Indeed, Carney claimed that the interest rate cut put in place post-Brexit helped to save a huge amount of jobs and settle the economy caused by the vote to leave the European Union back in June.

Even if the Bank of England do not cut interest rates next week any signals of one coming could cause Sterling to fall even further against the Euro. Therefore, if need to buy Euros before the end of the year then it may be worth buying a forward contract which means you can secure the current exchange rate removing the uncertainty caused by fluctuating exchange rates.

Having worked in the foreign exchange industry since 2003 I am confident of being able to offer you bank beating exchange rates when buying or selling any major currency and also help you with the timing of your transfer.

If you have a currency transfer to make and would like further information or for a free quote then contact me directly and I look forward to hearing from you.

Tom Holian teh@currencies.co.uk

Alternatively fill in the form below [contact-form to=’teh@currencies.co.uk’ subject=’Blog PSF 28/10/16′][contact-field label=’Name’ type=’name’ required=’1’/][contact-field label=’Email’ type=’email’ required=’1’/][contact-field label=’Currency Requirement’ type=’textarea’ required=’1’/][/contact-form] 

Poor manufacturing figures set the tone for sterling as rates fall to their lowest against the US dollar in nearly three years! (Mike Vaughan)

By
Daniel Wright
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Pound to Dollar forecast: Sterling continues to decline against the US Dollar

Poor manufacturing figures set the tone for a poor day as the pound crashed to its lowest level against the US dollar in nearly three years. Sterling was also to see significant losses against other majors notably 1.5% against the AUD, 1% against the NZD and 1% against the CAD. It was also to prove a mixed day for GBP/EUR with levels testing the 1.14 bracket early on in the day before rallying past 1.16 in the afternoon session.

This mornings negative data may prove to have been the main driver for the pound and has bucked the trend of recent positive data, however it did not stop the International Monetary Fund (IMF) from upgrading its 2013 growth forecast for Britain, reinforcing claims of green shoots of economic recovery. The IMF also said the recession in the eurozone area will be deeper than initially feared this year, with activity contracting by 0.6%, although it is forecasting the recovery to start next year with growth of 0.9%. Could this drive the pound back to 1.17/18? For me I feel yes and I think the initial reaction will reverse in the coming days and weeks.

As fir the US dollar todays shift has seen the dollar rally to a near three year low reaching 1.4813 at the low of the day. Anyone looking at the short term positions on the dollar should keep a close eye on the FOMC minutes from the FED’s interest rate decision scheduled for tomorrow at 19:00 BST – this is followed by a speech from FED Chairman Bernanke. Any announcements that go against the possibilty of ‘tapering’ down QE then watch for USD weakenss, however should Bernanke gives clues as to whether it will definitely happen then look for the recent trend of dollar strength to continue, however anyone selling USD may wish to take advantage as rates are at a near three year high against the pound.

To discuss the market conditions in more detail or should you have a transaction to arrange then please do not hesitate to contact me. As a specialist foreign exchange broker we have a number of contracts available to help clients avoid unwanted market volatility removing your exposure to any adverse market movement. If you would like to see what we can do for you and the potential savings we can make then contact the office on +44 (0)1494 787478 or email mgv@currencies.co.uk

 

IMF and World bank cause much volatility to global exchange rates with their comments. Sterling however has strengthened against the Euro and the CHF (Ben Amrany)

By
Daniel Wright
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Pound to Dollar Forecast: GBPUSD Continues Upward Trend but for How Long?

Sterling focus

Sterling exchange rates has rebounded this morning from yesterday’s low by half a cent against the Euro. Against all the majors that we trade the Euro and the Swiss Franc are the only
two currencies that the pound is up against. The spike against the EUR & the CHF is great news but the reason for the rest of our losses seems to be down to the IMF.  They have commented this morning that the global economic recovery is weakening. More alarming is that out of all the developed economies it has stated that the UK economy could be in for the biggest decline with our GDP expected to shrink by 0.4% this year. Sterling in general has not been affected first thing but today’s data may now have a greater effect on the pound.

 

Today’s Data to watch out for.

After last week’s batch of negative data we will be hoping for some positive news to come out over the course of this week to potentially give sterling a slight boost. Starting at 9.30 this morning we have industrial and manufacturing data along with our Trade balance figures. Looking closely at the figures we are expecting a decline over all sectors. However if the figures come out better than what is expected we may see a boost for sterling exchange rates.

Following these reports we then have a GDP estimate for the last three months by the NIESR (National institute of Economic & Social research) which will be released in the afternoon. This report is different to the official ONS (Office for National Statistics) GDP figures but can still cause the pound to significantly strengthen or weaken. I would be very wary around the decision and if you have a currency requirement to carry out you may be wise to look at securing your currency in between the morning and afternoons data. You may contact me at bma@currencies.co.uk if you require sending money overseas and are looking to make a saving over your bank or any other broker that you are currently using.

World Bank’s Comments boost the USD

The IMF seem to be echoing comments by the world bank. They they lowered their 2012 growth forecast for the world’s second largest economy China. The international lender estimates that economic activity in China will expand by 7.7%, as opposed to its previous estimate that GDP would grow by 8.2% this year. Although these figures are far greater than any western economy the decline in their GDP is a concern.

This has caused the USD to significantly strengthen against a range of currencies as investors have once again fled to the Dollar as the safe haven of choice. In fact the USD has now strengthened to its best level against the pound in a month.

Yesterday was a bank holiday in the states and today there is no data to note. However tomorrow could be key for those with a Dollar requirement. After trading closes in the UK there will be a release of the Fed’s Beige book. This is a report on the current US economic climate. Recently the data to come out of the US has been very positive with growth in many sectors.

 

A limit or maybe more importantly a stop loss order may be wise as our lines will be closed during this release. I personally feel that over the course of this month the pound will be trading in the late 1.50’s against the USD and if this is a concern for you then you may just want to trade before tomorrow night’s release.

A little about us

All of my clients that have found me through this website started reading our posts purely because they wanted more information regarding exchange rates and how to get a better deal than what their bank would offer them. Myself and my fellow authors at Pound Sterling Forecast work for one of the largest currency brokers in the UK. We have been in the industry for a culmination of 39 years so our extensive knowledge is second to none. We strive to make you a saving over all the banks and the savings can be up to 4%.

If you are reading this site and you have a requirement to buy or sell any major currency  you must get in contact to see if we can make you a decent saving on your hard earned money. Surely a quick comparison can do you no harm.

If you would like to compare our rates with that of your bank for international transfers please do email me with your details at bma@currencies.co.uk Just address it to Ben and I will come straight back to you.

I look forward to hearing from you.

Ben Amrany

 

Rollercoaster day for Sterling points to heavy ceiling for buying Euro and Dollar exchange rates (Joshua Privett)

By
Daniel Wright
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Pound Sterling Forecast – Will the Pound Weaken Ahead?

Today buying Euro rates breached fresh 5 month highs in addition to more attractive levels for Australian Dollar buyers following the historic interest rate decision last night across the Atlantic in the US.

This was only their second rise in interest rates in over a decade. In the world’s largest economy, there was certainly going to be financial ripples as a result.

The obvious and direct result was that for anyone holding Sterling the Dollar become more expensive following the rate hike announcement.

But why did the Euro and Austrlian Dollar take a bit of a dive?

The USD/EUR currency pairing is the most heavily traded in the world – frankly because they are the two most widely used currencies globally. So as a rule of thumb, due to the large amounts of transactions concentrated between the two, when one of the two currencies suddenly gets a large boost in demand, as we saw today, the other loses value through decreased demand. This is why GBP/EUR briefly breached 1.20 earlier today as a secondary effect of the hike.

The gains against the Australian Dollar similarly were due to a lower demand for AUD which sucked away some of its recent, and frankly over-inflated, value. The interest rate on the Australian Dollar is at record lows but still much higher than elsewhere at 1.5%, compared to the UK’s at 0.25% for example. However, it is traditionally seen as an unstable currency, so when you have a safe-haven currency which raises its base rate, investors like to opt for this safer option, and the sell-off of Aussies for US Dollars is why USD/AUD gained today, as well as GBP/AUD.

However, markets moved back sharply in the afternoon following this move, with GBP/EUR almost losing a full cent as an example.

It seems markets are worried the recent improvements on Sterling will not carry through the volatile end of year trading period. At the end of the year traders and companies wind down their positions in order to consolidate their profits in a stable currency to avoid coming back to their desks in January and finding outside forces have eaten away some of its value.

Of course the Pound is seen as anything but stable at the moment. So the Pound seems set to lose out to major safe havens such as the Dollar, Swiss Franc, and potentially the Euro, however, more exotic currencies should still see it hold its own.

As such anyone with a buying Euro and US Dollar requirement may be wise to move sooner rather than later to avoid the hefty amount of risk which should be piled onto Sterling in the very near term.

Sterling buyers, of course may consider the opposite and play the currency markets by ear as we edge closer to the Christmas period to try at catch the market at any peaks which emerge.

I am well positioned to help anyone with a Sterling based currency requirement manage their exposure to the markets in the run-up to the new year and beyond in order to maximise your currency return in this volatile marketplace. 

Contact me overnight on jjp@currencies.co.uk to discuss the particulars of your transfer. I have never had an issue beating the rates of exchange on offer elsewhere, so a brief conversation could save you thousands on an upcoming transfer.

You can also contact me on 01494 787 478, and simply as the reception team for Joshua (me) and they will put you through to my line.

 

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