GBP/EUR rates of exchange tumble and further pressure expected (Joshua Privett)

GBP USD Exchange Rate Slides after GDP Data Shows British Economy Shrank in June 

Looking back at the posts from other authors this week I hope their advice was heeded to use Sterling as a purchasing currency ahead of the events today. GBP/EUR, GBP/USD, GBP/AUD and a host of Sterling’s currency pairings fell sharply this afternoon as news for the UK interest rate hike timeline came in even worse than expected.

For the fourth consecutive month Sterling has suffered as a result of delays in an interest rate hike for the UK economy. This month, however, was worse than its predecessors, which explains why Sterling fell by more than a percent against most currency pairings today. As an example the day high and low for GBP/EUR was 1.42 and 1.39 respectively.

Mark Carney, the Governor of the Bank of England, had originally been hinting that rates could rise as early as Spring 2016. All of a sudden, after ending months of dodging questions, he has finally admitted that a hike was now firmly off the table until 2017.

Sterling will now be facing a difficult month ahead as investors unwind their current positions on the Pound and look elsewhere for greater short-term returns. One of the reasons Carney stated a hike was off the table was because he was expecting inflation to worsen. When this data comes out next week and confirms his fears Sterling’s value could face similar falls already experienced today against most of its currency pairings.

If not for news that the Volkwagen scandal doubled to include petrol powered cars as well as diesel on Wednesday, GBP/EUR should be even lower. The further loss of €3bn on the European stock-markets caused the Euro to weaken by two cents ahead of the events today. As such the fall this afternoon GBP/EUR could have hit as low as 1.37. A cushion for Euro buyers who did not move ahead of the announcement today.

I strongly recommend that anyone with Euros or various forms of Dollars to buy with Sterling over the next few months should contact me on [email protected] to discuss a strategy on your transfer and receive a competitive quote in order to maximise the value of the Pounds in your possession. 

These current rates of exchange can be fixed to avoid future losses on your transfer.

Greek elections lead to further Euro weakness – Dollar breaks 1.50 (Daniel Wright)

Pound to US Dollar rates influenced by political uncertainty in the UK

Greek elections show Syrizia victory – Further Euro weakness

Well we have certainly seen an extremely busy start to the year as far as the currency markets go and this weekend did not fail to add to the drama.

Yesterday Greece voted in favour of the far left group Syrizia who have been saying throughout the campaign that they would aim to re-negotiate the Greek debt package. On top of this they have also suggested even looking to leave the Eurozone which would cause even further problems  in an already stumbling economy.

What this brings is yet further uncertainty to the Euro both politically and in an economic sense which can tend to weaken a currency fairly significantly.

If you also consider the fact that it was only last week that the Eurozone introduced a huge QE (Quantitative Easing) plan then it is absolutely no surprise at all that the Euro has found itself well and truly out of fashion and has weakened significantly this year against Sterling and the Dollar.

As it stands it would cost almost £8,500 less to buy €200,000 today than it would have cost at the turn of the year which is certainly nothing to be sniffed at.

If you are looking to purchase a property overseas this year and you want to take advantage of current buying levels then there is a great option available to you known as a forward contract. This useful contract option allows you to lock into a rate of exchange for anything up to a year in advance, paying merely a small deposit initially and then the balance on or before whichever date has been agreed, this is absolutely vita if you are working to a fairly tight budget. Feel free to email me (Daniel Wright) directly on [email protected] with a contact number and I will be more than happy to call you personally.

Dollar breaks 1.50 – Antipodean weakness

Trading on Friday also saw Sterling drop through the 1.50 mark against the Dollar and I personally would not be surprised to see this run continue. In times of global uncertainty the Dollar can quite often become the main benefactor and it appears that this is happening again.  On top of this the antipodean and perceived ‘riskier’ currencies (AUD, NZD and ZAR) are starting to weaken off again.

With Europe finally showing huge cracks appearing and more uncertainty than England’s batsmen in the cricket, along with terribly sad news over the weekend that Islamic state have now potentially killed a Japanese hostage  there is a huge shift in global attitude to risk so a flight to safety to the Dollar is well and truly underway.

GDP figure for the U.K due out on Tuesday

Apart from the fallout from one of the most important weeks in the history of the Euro one key piece of data for the U.K is due out on Tuesday morning at 09:30am. The release is our GDP (Gross Domestic Product) figure for the last quarter of 2015. GDP basically measures how much an economy grew or shrank during a specific period and expectations are for the quarter to have shown a slight drop from 0.7% to 0.6% so any change to this may lead to an extremely volatile day for the Pound to add to what is lined up to be an exceptionally busy week.

Sterlings worrying forecast

Generally sterling has been gaining this week against most currencies, as regular readers will be aware, this is due to investors using the Pound as a safe haven for their cash. However GDP estimates fell yet again his week, June’s NIESR GDP forecasts fell back to -0.2% from +0.1% in May. This is now the fifth month this year, (out of six readings,) that has shown that the UK economy has contracted.

The Bank of England is well aware of the struggle which is why additional Quantitative Easing (QE) was announced last week, increasing the total target to £375 billion! Still, loose monetary policy seems to have proven ineffective around the globe and as a result I personally would not be surprised to see further QE being announced in the future.  (QE is the printing of money, the theory is it makes banks lend more which increases growth, however as more money is created it value falls, normally QE weakens a currency.)

This is more of a long term worry for clients, in the shorter term I personally would not be surprsied to see GBPEUR climb further. So good news for buyer, but why?

Well this week has already been a busy week for the Euro as Financial ministers meet in Brussells for a 2 days meeting. The big news was that covered in yesterdays blog that Spain is receiving a “banking bailout,” but in my optition they are joinging the majority now that have had a bailout; Greece, Ireland, Portugal and Cyrpus. That is why we are where we are at a near 4 year high. The reason why I think there is more to come is due to comments make from italy. Their prime minister said that he would be open to also receive a support package to lower the countries borrowing.  If this was confirmed I would think GBPEUR rates could push up to 1.30!!!!!!!

If you are in a position reading these blogs looking for the time to trade, I think it is very close! Now is the time to contact us if you need assistance….  Contact me personally by emailing me at [email protected] I look forward to hearing from you.

Positive Week for Sterling exchange rates

GBP EUR Higher After French Economy Shrinks

The Pound has had one of its most positive weeks of the year so far against a number of major currencies including against the Euro.

Earlier in the week the tone surrounding Brexit was a lot more positive and so far nothing has come out from the EU summit to cause too much concern.

A transitional deal appears to have been agreed and this has helped the Pound to make some welcome gains hitting the best rate to buy Euros since May 2017.

On Wednesday the Pound was given another boost with the latest set of Average Earnings data which showed that they have outpaced inflation for the first time in a very long time. With wage growth on the increase combined with high inflation this in my opinion means that we could be seeing an interest rate hike coming in May.

On Thursday the Bank of England voted 7-2 in favour of keeping interest rates on hold in the UK so there is clearly some appetite and room for the central bank to raise rates in the near future.

Bank of England governor Mark Carney was rather bullish about Thursday’s decision and suggested that the UK’s economy has been improving which provides support for a future rate hike.

As we end the month one of the most important data releases will come on Thursday with the latest set of UK GDP data for the final quarter of 2017.

If we see a positive revision then I think we could see Sterling break through recent highs and start next month on a positive footing.

However, it would be worth exercising some caution as we have seen GBPEUR rates rise close to where we are at the moment a number of times recently so could this be another false dawn for the Pound?

If you would like further information about what is likely to affect the value of the Pound and would also like a free quote then please email me directly and I look forward to hearing from you.

Tom Holian [email protected]

 

Sterling outlook for the week ahead – What may impact Sterling exchange rates this week?

Last week was indeed one of the most crucial for the Pound this year, with the announcement that the Brexit transitional phase has been all but agreed on Monday. The final vote on this took place at the EU summit on Friday. This acted as the catalyst for the Pound’s gains, which was also supported by the fact that at the latest BOE monetary policy meeting, 2 members voted in favour of an interest rate hike even though rates were left on hold at 0.5%. The USD was impacted by further tariffs levied on China to the affect of $60bn, and controversy surrounding the allegations made against Russia of a cyber attack on US power grid.

This week starts off relatively quietly, then on Wednesday we have US Gross Domestic Product and Core Personal Consumption figures, followed by Harmonised Index of Consumer Prices from Germany on Thursday.

As all readers are more than likely aware, this market is a strange one and still extremely politically driven, so do be wary of any movements regarding Brexit talks that may also impact the Pound at any time.

Below we have detailed some of the key data releases and events so you can keep an eye out for them.

Monday (today)

  • 09:45 – New Zealand | Imports (Feb) (NZD)
  • 21:45 – New Zealand | Exports (Feb) (NZD)
  • 21:45 – New Zealand | Trade Balance (Feb) (NZD)

Tuesday

  • n/a – Australia | HIA New Home Sales (MoM) (Mar) (AUD)
  • 00:45 – Australia | RBA Assistant Governor Kent Speech (AUD)
  • 09:00 – Euro | Business Climate (Mar) (EUR)
  • 13:00 – US | S&P/Case-Shiller Home Price Indices (YoY) (Jan)
  • 15:00 – US | FOMC Member Bostic speech (USD)

Wednesday

  • 07:00 – Germany | Gfk Consumer Confidence Survey (Apr) (EUR)
  • 08:00 – Switzerland | ZEW Survey – Expectations (Mar) (CHF)
  • 12:30 – US | Gross Domestic Product Price Index (Q4) (USD)
  • 12:30 – US | Gross Domestic Product Annualized (Q4) (USD)
  • 13:30 – US | Personal Consumption Expenditures Prices (Q4) (USD)
  • 13:30 – US | Core Personal Consumption Expenditures (Q4) (USD)
  • 14:00 – US | Pending Home Sales (MoM) (Feb) (USD)
  • 16:00 – US | FOMC Member Bostic speech (USD)
  • 21:45 – New Zealand | Building Permits s.a. (MoM) (Feb) (NZD)

Thursday

  • 07:00 – Switzerland | KOF Leading Indicator (Mar) (CHF)
  • 08:00 – Germany | Unemployment Change (Mar) (EUR)
  • 08:00 – Germany | Unemployment Rate s.a. (Mar) (EUR)
  • 08:30 – UK | Gross Domestic Product (Q4) (GBP)
  • 08:30 – UK | Mortgage Approvals (Feb) (GBP)
  • 12:00 – Germany | Harmonised Index of Consumer Prices (YoY) (Mar) (EUR)
  • 12:30 – US | Personal Consumption Expenditures – Price Index (MoM) (Feb) (USD)
  • 12:30 – US | Core Personal Consumption Expenditure – Price Index (Feb) (USD)
  • 12:30 – US | Personal Income (MoM) (Feb) (USD)
  • 12:30 – US | Core Personal Consumption Expenditure – Price Index (YoY) (Feb) (USD)
  • 12:30 – US | Personal Spending (Feb) (USD)
  • 12:30 – US | Continuing Jobless Claims (Mar 16) (USD)
  • 12:30 – US | Initial Jobless Claims (Mar 23) (USD)
  • 12:30 – Canada | Gross Domestic Product (MoM) (Jan)
  • 13:45 – US | Chicago Purchasing Managers’ Index (Mar) (USD)
  • 17:00 – US | FOMC Member Harker Speech (USD)

Friday

  • 00:01 – UK | Gfk Consumer Confidence (Mar) (GBP)
  • 07:45 – France | Consumer Price Index (EU norm) (YoY) (Mar) (EUR)
  • 17:00 – US | Baker Hughes US Oil Rig Count (USD)

If you have a currency exchange to carry out in the coming days, weeks or months and you would like my assistance, both with timing a transfer and achieving the best rate when you do go about booking it then feel free to contact me, Daniel Wright directly on [email protected] and I will be happy to help you personally.

Sterling exchange rates following inflation data – The Bank of England is stuck in a tricky position to say the least (Daniel Wright)

Pound to Dollar forecast: Sterling continues to decline against the US Dollar

The Pound has risen ever so slightly this morning following inflationary data coming out slightly higher than expected.

The Bank of England would like the Pound to be weaker but the problem they face is that the lower the Pound the more imports will cost, therefore goods are more expensive which is not good for inflation.

Raising interest rates to combat inflation will lead to more expensive borrowing costs for everyone and growth being stunted due to less investment.

Not a nice position to be in – A rock and a hard place comes to mind!

For those of you that do not follow the markets the reason that this has led to the Pound gaining value is that the Bank of England do not want to have inflation getting too high and this is a sign that is is creeping up (things are getting more expensive to buy). The best way top tackle high inflation is to raise interest rates and a hike in interest rates generally is seen as positive to the currency concerned as it makes it more attractive to investors.

The currency markets do move in advance of things like this happening which is why the Pound has gained as the chance of a rate hike has increased ever so slightly.

Of course there are a lot of other factors that may affect rates in the coming days, we have the Bank of England minutes tomorrow morning which will show us how many members voted in favour of or against both Quantitative Easing and an interest rate change.

Indications that we are on the edge of further QE may be seen as negative for the Pound and the last few months this has been the more likely however any indications that members heads are moving towards a hike in rates could lead to another boost for Sterling.

Be aware we also have the budget tomorrow which in all honesty is rarely a big market mover however you always need to be cautious of a surprise popping up!

If you have a pending currency transfer to carry out from bank to bank and you want not only to maximise your exchange rates but also to receive a great level of service and assistance then feel free to contact me directly by email [email protected] with a brief description of your requirement and a contact number and I will be more than happy to call you straight back. We have won numerous awards both for our rates and customer service and I will be highly surprised if I cannot save you money over your current provider.

I look forward to hearing from you.

 

Sterling Ahead of GDP Numbers Expected to Fall (James Lovick)

The pound has seen an excellent run across all of the major currencies although that rally appears to be running out of steam after another last push higher throughout yesterday. GBP EUR in particular is showing signs that the rally may not push much higher from here.

This morning sees the release of eagerly awaited GDP numbers for the first quarter of 2016. Economic data for the manufacturing and construction sectors have performed badly in recent months and we are expecting this to show in the numbers released this morning. In fact the figures were so bad last month for industrial and manufacturing production that there is a real concern that the economy has seen a sizeable drop in output. The National Institute for Economic and Social Research (NIESR) have forecast a reading of just 0.3% this morning. There forecasts of the official figures are usually very accurate so I struggle to see a good outcome for the pound this morning. A figure at 0.3% should carry some risk for the pound and anything lower would be particularly worrying.

As far as the EU referendum is concerned there will inevitably be increased volatility as we approach 23rd June. This is a major political situation for Britain to find itself in. What I find interesting is that the Leave campaign have so far had very little to say on the matter. On the other hand the Remain campaign have now used and published all the major institutions economic forecasts to support their cause including the OECD outlook this morning. They have now also had the benefit of US President Barack Obama and his extremely pro EU comments which were borderline threatening when suggesting we would be at the back of the queue when negotiating any new trade deals. They have also had their leaflet drop to every home in Britain. I don’t feel this lack of action from the Leave campaign so early on in the campaign is coincidental. I would expect to see very strong campaigning from the Leave campaign from here on and if done convincingly should see some major headwinds for sterling going forward.

Buyers of Euros in particular may wish to consider taking advantage of the 5 cent gain in the last two weeks for GBP EUR. Considering rates distinctly looked like they were heading below 1.20  for this pair just a fortnight ago highlights the kind of  downward pressure on sterling but there is clearly a win opportunity at the moment for anyone holding sterling.

If you have an upcoming GBP currency requirement either buying or selling with any other currency and would like to be kept up to date with key market movements, or simply wish to compare our award winning exchange rates then please feel free to contact me on 0044 1494 787 478 and ask one of the team for James. Alternatively you can email me directly at [email protected]

Sterling exchange rates falling through the floor. (Ben Amrany)

It has turned out to be an extremely poor day for sterling sellers as the pound has weakened to worse the levels in 5 months against the USD trading at 1.5743, currently at a 14 month low against the Euro trading at 1.1498 and the pound has also lost over 1% on the day against the CHF, NZD, ZAR SEK. The pound is down against all the majors.

The losses that the pound has recently been witnessing does not seem to be slowing at any time soon. In fact today we had UK manufacturing data out which was worse than what the markets were predicting. This is showing that there is a real possibility that the UK could dip back into a triple dip recession and is really hindering the pound. Plus the further the UK economy contracts the potential that the UK’s borrowing costs could rise is threatening our AAA rating.

All the above is not helping thoses of you that need to sell the pound. It is now more important than at any other time to make sure when you carry out your exchange you get the best rate possible. Here at www.poundsterlingforecast.com the authors of the site work for one of the largest currency brokers in the UK. All that we do is currency exchange which enables us to offer our clients a very personal one on one service. We will try and help you judge when may be a good time to make your conversion while always striving to make you a significant saving over the banks and any other brokers that you have been dealing with. Please feel free to email me at [email protected] with your requirements and I will contact you straight away to explain all the options that are available to you and how we can help you make a saving on your exchange.

Don’t delay as the longer you are currently leaving your exchange the more expensive it is becoming. If you need to buy the pound then rates are so attractive that we can explain your options as to how you may be able to achieve the best levels in months.

Ben Amrany

A quiet week of data for Sterling exchange rates – Why not use this week to revise who you use for foreign currency

GBP EUR Starts the Week with 1.1800 Test

Much like every household bill it always pays to check up on the company you are using from time to  time, and this is the same when using a foreign currency brokerage.

Many have now shifted clients to their online platforms which can result in lower exchange rates, some currency brokers out there may take advantage of your loyalty, we have had clients get in touch with us that have been using other brokers for years but have found the more comfortable they have got with them the more their rates have tended to slip.

Here at Pound Sterling Forecast we do not only offer up to date, interesting market information and opinions but all the writers on this site also work for one of the largest currency brokerages in the U.K. We can help people in most locations around the world move money from one bank account to another, at an extremely competitive price quickly, efficiently and with the very highest levels of customer service too.

We aim to help clients tailor a game plan for their purchases and go that extra mile for clients in this current day and age where many companies just treat you as a number.

If for example you are buying or selling an overseas property, the timing of when you book out your rate can make the difference of thousands of pounds, and we aim to help give you all the information you need to make the right decision, along with the very best rate when you have decided you would like to book out your currency .

If you are in the position where you may need our services in the coming days, weeks or months then it is really simple to get in touch to obtain more information or a free quote. You can email me (Daniel Wright) the creator of this site on [email protected] and I will be more than happy to assist you going forward. I have worked at this company for over 10 years now and would be glad to add you to my current client list.

 

Still a Good Time to BUY Euros? Exchange Rate Forecast (Andrew Bromley)

Pound to US Dollar rates influenced by political uncertainty in the UK

A short one this evening!

The Pound is still at strong levels against Euro as the Euro has not been able to counteract the GBP gains last week. Sterling made its gains last week primarily due to very strong retail sales and an improved level of public sector net borrowing. The key event for anyone buying with GBP is 09:30 tomorrow morning when the UK GDP revision is released. There is a slight reduction anticipated, down from 3.2% to 3%. Those selling Euros may want to take advantage as the medium term shows signs of Euro weakness, following the anticipated introduction of Quantitative Easing.

The UK GDP Revision is followed on Tuesday by US GDP at 13:30, a slight reduction also anticipated down to 4.1% from 4.6%. This may present an opportunity to buy USD…

If you have an exchange requirement, please feel free to contact me directly on the trading floor 01494 787 478 [email protected]

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Where interbank exchange rates are referenced within the website these should only be used as a guide on the performance of a market. These rates are not indicative of our exchange rates – please contact us for a quote.