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DUP deal finally realised, buying Euro and Dollar rates showing positive signs (Joshua Privett)

By
Daniel Wright
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We’ve known the deal has been coming for a while, which may explain why buying Euro and Dollar rates only flirted upwards by half a cent of so yesterday with the confirmation of the agreement between the DUP and the Conservatives.

Call the £1bn investment in Northern Ireland what you will, but currency markets themselves will be much more focused on developments later this week, and how the Government’s policies will be impacting the Brexit agenda.

Whilst headlines will certainly grab the £1bn fact from the DUP arrangement, we have heard little so-far as to how the special situation of Northern Ireland, sharing a land border with the Eurozone like Gibraltar, will affect the Government’s hard brexit aims.

The ability for free travel, Custom’s Union, and economic access are all on the table, and Theresa May will be forced to clarify this at least to some extent during Parliamentary debates this week, and for Thursday’s vote on the Government’s agenda.

Any hints of concessions will very likely see a heavy spike in the Pound. Personal political views aside currency markets are one which have traditionally hoped for stability and certainty. A softer break from the EU comes under this umbrella, and repeatedly since the Referendum, suggestions to this effect have played well with Sterling’s value.

So at this point the Pound is expected to improve at the end of this week with some stability re-established to the UK political arena. The real question is whether Sterling can make significant gains on buying Euro, US Dollar and Australian Dollar rates of exchange back above the respective 1.18, 1.30 and 1.75 levels which were available only last month.

As my article at the weekend suggested the urgency is still very much in the realm of Sterling buyers in my opinion, with the pressure keeping the Pound cheap from a calamity of election about to be relieved. If you are selling Euros, US Dollars or Australian Dollars for Sterling and wish to discuss your options, you can contact me immediately by calling 01494 787 478 and asking the reception team to be put through to Joshua.

Conversely, Euro, US Dollar, and Australian Dollar buyers do not face the same level of urgency and, as such, can also call or email me on jjp@currencies.co.uk to discuss a strategy for your transfer aimed at maximising your currency return.

I have never had an issue bettering the rates of exchange offered from high street banks or alternative currency brokers, so a brief conversation could save you thousands on a prospective transfer.

Pound makes gains against the Euro and the US Dollar but how long will this last?

By
Tom Holian
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Will GBPEUR rise further this week?

The Pound made some gains yesterday after much better than expected UK Services Sector data which showed a rise to 54 compared to the previous month which was 52.8.

This has given rise to a hint that interest rate rises may be discussed again but until we have a flurry of good economic data I do not foresee a rate hike coming in the near future for the UK.

The Pound is now trading above 1.14 against the Euro and also 1.34 against the US Dollar following on from the news.

Meanwhile if we look at the political landscape over the next few days the EU Withdrawal Bill will be discussed next week on June 12th. The House of Lords had made a number of amendments last month so next week’s meeting could cause a lot of movement for Sterling exchange rates this time next week.

Over in Europe things appear to have settled down slightly in Italy with New Italian Prime Minister Giuseppe Conte announcing new plans for moving the country forward including cutting tax and curbing immigration.

One real sticking point however for Italy is that they currently have a debt of 130% of GDP which is clearly a big concern and way above that expected by the European Union.

The Italian debt problem could cause a big problem in the future but at the moment things do not appear to be reflected in the value of the Euro which highlights to me the problems faced by Sterling caused by the ongoing Brexit uncertainty.

My personal opinion is that we’ll see Sterling remain in a fairly tight range as we have seen over the last few months but with a number of economic data releases over the next few days including Eurozone GDP data due out tomorrow and the latest NIESR UK GDP estimate for the last three months published on Friday we could see a volatile end to the week for the Pound.

If you have a currency transfer to make and would like to save money on exchange rates compared to using your own bank then contact me directky for a free quote and I look forward to hearing from you.

I work for one of the UK’s leading currency brokers and I’m confident with my 15 years experience that I can be of assistance to you.

Tom Holian teh@currencies.co.uk

What next for the pound? EU Summit will unsettle nerves!

By
Jonathan Watson
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Pound to US Dollar Exchange Rate: What will Brexit do to the GBP/USD rate?

The pound is likely to be in for a very tough few weeks as investors try to second guess the future direction for the UK economy and predict the impact on sterling exchange rates. The  The pound is not performing well in such an uncertain environment although there will be opportunities. Let me be very clear, the next 6 months will present some very favourable opportunities to buy the pound. Arguably we are already in the midst of those opportunities, Euro sellers for pounds are achieving 10% more than in November. USD sellers for the pound are achieving 8% more. These movements in such a short space of time should not be taken too lightly but yet of course it could get better.

Markets move ahead of events so right now the institutional investors who move markets are thinking hmmm, I don’t know is next for the pound and the UK. I am selling my pounds. They are planning for the worst in anticipation of a possible Brexit and worse news up ahead. Often on markets events are not as bad as everyone predicts which means that we may well see the pound spike up as the new is essentially ‘not so bad’.

All in all if you are buying the pound in the future things could easily improve but I am sure you don’t want to miss out if as is so often the case on exchange rates and markets, things aren’t as bad as everyone expected. If you have a transfer to consider then please get in touch, I can keep you up to date with the latest trends and themes and help plan and manage your transfers. Please email jmw@currencies.co.uk to learn more about all the services and options we can provide.

GBP/EUR and GBP/USD exchange rates see deceptively volatile day (Joshua Privett)

By
Daniel Wright
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Pound to US Dollar forecast: What could influence the Pound to US Dollar rate this week?

GBP/EUR and GBP/USD have seen relatively little change by the end of trading this week, but this hides a significant amount of movement both today and earlier in the week.

While GBP/EUR did finish in the mid-1.38’s, rates did get as low as 1.37 today following the announcement of strong intervention by the European Central Bank to stimulate growth in the European economy.

Financial stimulus was to be more than doubled, and this increased confidence in the Eurozone heading into 2016, which allowed some Euro strength which was, unfortunately, short-lived for Euro sellers. GBP/EUR rates did end the day on 1.38.

The US Dollar had a poor day relative to the Euro. GBP/USD saw a full Cent of difference between the high and the low with buying rates rallying to 1.52 following some lower than expected retail sales figures.

This has been a consecutively poor performer for the US economy for five straight months, and markets were hoping the boosts from pre-Christmas sales and ‘Black Friday’ would turn this around. It did, but not as much as many had hoped. The USD lost value and GBP/USD buying rates rose as a result.

However, next week will likely see the most testing period for both GBP/EUR and GBP/USD buying rates for the remainder of the year, and possibly even the first few months of 2016.

Inflation readings for the UK will be coming out on Tuesday. Currently at the lowest levels since records began, these readings are why an interest rate hike was taken off the table for the UK economy until 2017 at the earliest. With no expected changes, Sterling will likely be experiencing the same weakness which has caused full-cent drops against the Euro following these readings each month since August.

On Wednesday, the US interest rate decision will finally be announced after a few months of severe market anticipation. With an expected rate hike to occur, the first in the Western World since the financial crisis, strongly exaggerated USD strength is expected. As a gauge for USD buyers, the last time a hike was close, GBP/USD fell to 1.47.

I strongly recommend that anyone with a GBP/EUR or GBP/USD requirement should contact me over the weekend on jjp@currencies.co.uk to discuss a strategy for your transfer in order to maximise your Euro or Dollar return. There could still be some opportunities on Monday to seize before any expected drops, and I have never had an issue beating the rates of exchange offered elsewhere.

Sellers can do the same, and I can explain the best way to ride any expected movements in your which materialise next week and secure a higher Sterling return on your exchange.

UK Budget and Cypriot Fears-How will this affect my currency transfer?

By
Tom Holian
-
GBPUSD Slips Away from 9 Month High

With the UK Budget due later today the currency markets are holding their breath in anticipation of what Chancellor George Osborne will announce. The Chancellor has already told his staff that they will need to cut 2% of their departments’ spending for the next two years and the proposed saving of £2.5bn will go to infrastructure plans in order to boost growth in the UK. With Great Britain having lost its triple A credit rating recently and close to possibly dropping into a triple dip recession at the end of this month we are entering a very uncertain period.

Osborne will begin speaking at 1230 UK time so if you are thinking about making a currency transfer please contact me on 01494-787-478 and ask for Tom Holian and I’ll happily provide you with a free quote to exchange currency. The coalition have made the deficit reduction the main focus recently so cuts will likely be in the forefront of the Budget. One important announcement may be a change to the inflation target as set out by the Bank of England. Currently the target is 2% and with inflation having remained above this level for quite some time the Chancellor may look to alter this figure.

Cypriot Banking fears cause fallout across Europe

Overnight in Cyprus political leaders have voted in favour of rejecting an international bailout deal. After the planned levy on savers’ accounts was failed to be approved of in parliament Finance Minister Michael Sarris is currently in Russia trying to seek a deal owing to the amount of Russian investment on the island nation. Banks will continue to remain shut until Thursday in order to avoid a run on the bank.

This morning GBPEUR exchange rates have fallen by over 0.6% so far and GBPUSD by 0.5% as investors remain cautious about the Budget later today. For a free quote or if you want to be alerted to markets spikes please email me directly Tom Holian teh@currencies.co.uk quoting ‘CURRENCY SPIKE ALERT’ in the title of the email.

 

Cyprus helps support GBPEUR rates to highest in 30 days – When to buy the Euro (Steve Eakins)

By
Daniel Wright
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We have been particularly busy this morning due to the news breaking out of Cyprus.  Not that the small economy, the third smallest across the Eurozone is receiving a bailout, but that as part of it funding needs to be raised by a bank levy. This bank levy is currently expected to be 6.75% on anything under €100,000 in any personal account held by a Cyprus account and closer to 8% on anything over.  It seems that Germany is uncomfortable to pay out a country that they see as a hotspot for money laundering of rich Russians.  This current proposal is being voted on today inside the Cyprus Government which could see a deduction to 3%.

It resulted in a run on the banks across Cyprus in a similar way we saw back in 2008 on Northern Rock here in the UK and the concern is this could spread across other European countries causing the house of cards to fall apart.  It has in turn weakened the Euro significantly over the weekend making it the best time to buy the euro for over 30 days with the pound, a month high.

So when shall I buy euros?

Well the knee jerk reaction currently is quite attractive, I personally cannot see any spread of contagion in the near future so would be looking sooner rather than later.  We also have to respect the UK Budget later this week on Wednesday which could easily put the Pound back on the negative sloop which is the more common route through 2013 with a 8% loss seen at some points against both the dollar and the euro this year.

However as the US markets have not traded on this news I can imagine a further gain for the pound this afternoon.  If I needed to buy euros within the next 15 days I would be very much looking at rates today to complete my exchange or to limit my exposure but doing some and employing limit orders and stop orders.  For more information on what these contracts are and the other benefits of using a currency broker over your bank contact me, Steve Eakins at hse@currencies.co.uk

This spike in the market has seen quick moving clients that had registered for SPIKE NOTIFICATIONS via hse@currencies.co.uk save nearly 3% compared to a week ago or £6,250 on a €200,000 purchase.  If you would like to benefit from these notifications register your interest by giving me a call, Steve Eakins on the normal number or via email at hse@currencies.co.uk

UK General Election crucial to Sterling value (Daniel Johnson)

By
Daniel Johnson
-

A particularly difficult period to trade Sterling

It appeared to be a shrewd move by Theresa May to call a snap election while the opposition was so weak. A conservative victory is deemed to be the safer option for the UK economy, which is why we saw an advance in Sterling  value against the majority of major currencies following the announcement.

Since then however, May has shot her self in the foot by attacking her core voters. The elderly will now have to pay for their own home care or care home if they have in excess of £100k in assets. This has caused many to change their vote. On the other hand Corbyn has gained popularity, particularly amongst the younger voters with sweeping changes to the education system which would greatly reduce student fees. The conservative lead has now been slashed and it will be difficult to for the conservatives to gain a majority victory.

Historically, the currency in question weaken 24hrs-48hrs before the vote due to political uncertainty.

If the conservatives win I would expect the pound to rally. A hung parliament is a possibility with Labor gaining ground. If we do see a hung parliament I would expect the pound to lose further value.If a coalition is required it may be difficult for the Tories to find allies due to what happened to the Liberal Democrats during the last coalition. If Labour were to form a coalition there is the possibility it could be with more than one party. All the parties have differing manifestos and getting anything through parliament could be very problematic. We have Brexit to deal with, we need a strong, decisive government to negotiate some of the most challenging deals in the last fifty years. A coalition, unable to work together could be catastrophic for Brexit negotiations.

If you are trading during this period you need an experienced broker on board in attempt to maximise the return on your trade during such a volatile period. If you would like my assistance then you are more than welcome to speak with me directly. I will be more than happy to help you both with trying to time a transaction and getting you the most competitive rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference, so for the sake of taking a couple of minutes to email me you may find you yourself saving hundreds, if not thousands of pounds. Feel free to contact me at dcj@currencies.co.uk. Thank you for reading.

 

 

Great Expectations… GBP Weakness…

By
Jonathan Watson
-
Pound to US Dollar Exchange Rate: What will Brexit do to the GBP/USD rate?

The pound has dipped this morning despite a raft of good economic data showing improvements in government borrowing and falling budget deficit. There had been some high expectations of seeing the pound move higher due to a more hawkish outlook by the Bank of England but this failed to materialise. As one of my clients said to me ‘you can’t even trust the Bank of England’ nowadays…

This was in reference to their commitment to consider raising interest rates if the Unemployment rate dipped below 7%. This particular caveat was of course met recently causing the pound to spike but for now the BoE will not be raising interest rates, it would simply cause more problems.

If you are expecting the pound to just keep rising you could therefore be very disappointed as we need to see some really good data to warrant such a spike. I find the best way to maximise your return on your currency exchange is to set realistic targets and limits. If you would like some assistance in the execution and planning of your transfers please contact me Jonathan on jmw@currencies.co.uk, even if your transfer is just a once off, we can help get you the most for your money.

Thank you,

Jonathan

 

 

A Volatile Week for the Pound (Matthew Vassallo)

By
Matthew Vassallo
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Pound to US Dollar forecast: What could influence the Pound to US Dollar rate this week?

It’s been a volatile week for GBP, with uncertainty surrounding the Scottish referendum having a negative impact on the Pound. We started the week with news of a poll that had the vote at 51% in favour of Scottish independence and this sent the markets into panic mode, with GBP/EUR rates dropping by over a cent. Since then we have heard mixed opinions from various figureheads but it does seem as if the initial poll was distorted and in fact the No vote was still the preference of the majority.

GBP/EUR rates are now reflecting this opinion, with a move back towards 1.26 during yesterday’s trading. We’ve also heard from Bank of England (BoE) governor Mark carney this week, who indicated we may see an interest rate hike in the UK by Spring 2015. This is the first time he has given a specific timeframe and this news also helped to support Sterling recovery, from the early week losses against both the EUR & USD.

GBP/USD rates have also seen a number of spikes this week with the USD still holding firm in the low 1.60’s, as it continues to realign itself against GBP after a rocky few months. It now seems inevitable that we will see GBP/USD head back below 1,60 on the exchange and I wouldn’t be surprised to see this before the end of the year.

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 mtv@currencies.co.uk

Sterling Exchange Rates Rally Close to 1.13 for GBP EUR

By
James Lovick
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Pound to US Dollar forecast: What could influence the Pound to US Dollar rate this week?

The pound continues to trade within a tight range as the markets still await new developments in the Brexit negotiations. The pound is currently trading at 1.1270 against the Euro and 1.39 against the US dollar having seen reasonable gains across the board today. Those clients looking to sell Euros for pounds have been presented with another good opportunity to convert. The focus is now largely on Brexit with the terms of the transitional arrangement expected to go through in the next couple of weeks.

The next round of negotiations which will cover the thorny issue of the future trading terms and are expected to commence towards the end of March when the pound could see considerable volatility at this time. In my view both sides are likely to start at the furthest sides of the negotiating table with clear red lines which could make a deal seem almost impossible at first. As talks progress then the pound could start to rally if it looks like there is a deal to be had. This is something to be aware of for the medium term and any positive comments could help the pound rally especially when it comes to financial services. The outlook for the short term however does not look so bright with no real certainty being offered at this time. Certainly from a selling perspective there are some excellent prices available at present for buying pounds.

Australian Dollars

The Australian dollar is another currency with a less clear future and is seeing a lot of volatility at present on the back of developments in Australia and overseas. The policies being adopted by US President Donald Trump are of concern for Australia as recent changes that he has made to include the imposition of tariffs on steel and aluminium can have a negative impact on the Aussie. The prospect of a trade war could weigh heavy on the commodity currency and the Aussie could weaken further. Similarly a sequence of interest rate hikes are expected from the US Federal Reserve throughout 2018 and this could see the Australian dollar also weaken as funds move away from Australian and back to the higher yielding US dollar.

The other big driver for GBP AUD is what is happening with Brexit and in the short term I see the pound falling lower. Clients looking to sell Australian dollars may see a window of opportunity to convert although beyond that if the mood on Brexit looks better than the pound could see considerable gains against the Aussie.

For information on sterling exchange rates or any other major currency then please get in touch and I will be happy to assist. You can email me at jll@currencies.co.uk

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