Flash crash sinks Pound to US Dollar rates

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

Pound to US dollar rates suffered the effects of increasing uncertainty in financial markets as GBP/USD surged into the 1.24’s on safe haven fears. The move came overnight as auto-trades were triggered by a slump in global confidence.

The news on financial markets has been shaky to say the least as we enter 2019 with the growing threat of worsening trade wars, political uncertainties and a growing chance of a financial crisis.

Stock markets globally have been lower and it might have been some particularly bad news regarding technology company Apple which triggered the flash crash, as investors quickly sold off assets and bought into safer havens, like the US Dollar.

Clients with a position to buy or sell US dollars for pounds look set to be in for a very choppy period as the market is forced to consider an increasing number of potentially negative events.

Uncertainty as Brexit gets closer to final stages

On the UK side, Brexit is stoking investors fears as we get closer and closer to the final stages, with no clearer expectation on what Brexit will mean. Clients with a position involving sterling are at the mercy of the next twists and turns on UK politics, which is proving extremely hard to forecast.

The likelihood of the pound slipping further are high as the market is forced to take on the possibility of either a no-deal Brexit, a General Election, a second Referendum and even the possibility of Brexit being postponed through an extension of Article 50. Sterling would rise if Theresa May’s plan can be forced through Parliament, but this is looking very challenging at present.

On the dollar side the performance is more tricky to explain, since the US dollar can adopt different behaviours. As a ‘safe haven’ currency, the US dollar will often strengthen in times of economic uncertainty, as it did last night. It will also rise when there is strong economic news which will support further interest rate hikes.

Overall it seems we can paint a picture of the US dollar rising further against the pound as the market has to take stock of the uncertainty in the UK, and the various factors which appear likely to support the US dollar. The trading ranges for pound to US dollar rates could easily slip lower into the 1.20’s and getting back over 1.30 looks harder than ever at this present moment.

Last night’s flash crash underscores just how important being prepared is, to get the best pound to US dollar exchange rates. For more information on putting in plans to ensure you may capitalise on any volatility and maximise your currency exchange, please feel free to contact me directly using the form below to discuss exchange rates further.

GBP/EUR Forecast for Q1 2019

Was the Pound’s Sell-Off “Overdone”?

GBP/EUR Forecast: For clients that are planning GBP/EUR currency transfers throughout 2019, Q1 is going to have a major influence on the exchange rate for the remainder of the year. The ongoing Brexit negotiations are coming to an end and MPs are preparing to debate Theresa May’s Brexit deal the first week they return. Following the debate MPs will have the meaningful vote which is crucial for the Prime Minister and ultimately the strength of the pound.

If Conservative MPs vote in favour of Theresa May’s plan, quite simply I expect GBP/EUR exchange rates to rally, and by the end of Q1 I expect GBP/EUR to be trading in the higher teens (1.16/1.18). The reason I believe GBP/EUR will rally significantly is the uncertainty will be removed meaning businesses do not have to worry about not being able to trade within the EU and I also expect the Bank of England to up growth forecasts and hint towards hiking interest rates towards the back end of the 2019 summer.

However if MPs vote Theresa May’s Brexit plan down, depending on how many votes she loses by I believe will dictate what happens next. If she loses by a handful of votes, I expect she will contact certain MPs directly and try to persuade them to change their minds and another meaningful vote will follow shortly after. Furthermore, if she loses by a significant amount I personally don’t believe she will take the UK out of the EU with a no deal Brexit, therefore I expect her resignation or Jeremy Corbyn will file a motion of no confidence against the Government. Either way both scenarios will cause further uncertainty and therefore I expect the pound to make further losses.

If Theresa May resigns then a leadership contest will follow and I find it difficult to see who will take over as the Conservative Party are so torn between leaving with no deal and a peoples’ vote. In addition if Jeremy Corbyn files a motion of confidence, I’m not convinced the DUP will continue to support the Prime Minister. Both scenarios I expect will push GBP/EUR rates towards 1.05.

If you are buying euros with pounds or selling euros to buy sterling, I would recommend getting in touch to discuss your options. We have contracts available such as limit orders and stop losses which help clients maximise their returns whilst using safety nets so there are no surprises when they eventually secure their currency. For more information feel free to feel the form below and I will give you a call to discuss your own specific requirements.

Will the Pound to Euro rate drop below 1.10? What may happen to GBP/EUR in early January?

GBPEUR Sees a Sharp Rebound with ECB Stimulus Plans

The Pound has remained reasonably flat against the Euro this week as we enter the festive season and I feel that this may be the situation until the end of the trading year, unless any large surprises pop up.

With very little news due to come out from Brexit now that Parliament are due to take their recess period the market will be reliant on general sentiment and any surprise news that hits the media.

Generally at this time of year you can find that trading levels are much thinner, so if there are any developments with Brexit or any market moving releases, then you may see the rates move a little more than normal.

Will Sterling Euro drop below 1.10?

Many of my clients are now asking me if I feel the rate could drop back below a key resistance level of 1.10 and I have to say that in my opinion the answer is yes. Whether or not it stays below 1.10 for a long period of time will be dependent on how things go for Theresa May in her Parliamentary vote. As it stands if you look at both sides of GBP/EUR politically and in terms of economic performance the Pound has more chance of dropping than rising.

UK growth downgraded

Growth expectations were yesterday downgraded for the UK by Bank of England Governor Mark Carney, from 0.3% to 0.2% and even matters like the Gatwick drone issue will not help economic performance for December as airlines will have a huge headache to try and overcome.

Parliament expected to vote down current Brexit deal

The Parliamentary vote on Brexit is due to happen in mid January and I really do not see how Theresa May is going to get enough support to push through her deal. I cannot see her getting enough improvement on its current terms to turn enough heads.

I would expect Sterling to wobble in advance of this vote, however it would not be a surprise to see the Pound strengthen after it, even is she loses as although it does open up the possibility of a ‘no deal’ Brexit it does also give the potential of Theresa May leaving and someone else taking the reigns. This may delay or even cancel Article 50 which could actually give Sterling a huge boost.

All in all if you have a large exchange to make in the near future involving buying or selling Euros then it is key that you deal with a proactive and efficient currency broker that can help you negotiate these choppy waters ahead. We here at Pound Sterling Forecast can help you with this, along with helping you secure a highly competitive rate when you do come to actually lock in your exchange.

Fill in the form below and I will be happy to contact you personally and to help you tailor a game plan for your specific situation.

GBP to AUD forecast: US and China reported to have fallen out again over trade negotiations

Australian Economy Likely to be Worst Hit But to Bounce Back Strongest

It has been said that the talks between US and China have once again fallen out over the well publicised trade wars, which has weakened the Australian Dollar ever so slightly today.

Both sides of the negotiations are essentially trying to get the best out of this deal that they can, and currently the U.S is apparently accusing China of ‘stealing technology’ also noting that it is unacceptable for China to ‘dump their products’ on the US.

In return China are said to have suggested that it is the ‘reckless action’ of the US that has led to this trade system crisis and both sides are also accusing each other of undermining the multilateral trade system.

As all regular readers are likely to be aware, when the US – China trade discussions appear to be going well this is generally positive for the Australian Dollar and when they are going badly it tends to weaken.

This is mainly due to the close trade relations between Australia and China and the fact a high percentage of tourist Dollars spent in Australian come from China.

Personally I expect these talks to rumble on for some time and having reviewed President Trump’s actions against a number of other issues I would not be surprised for further disagreements to arise and for this to weigh on the Australian Dollar further.

Let us not forget the on-going saga in the UK which could also impact the Pound quite significantly. Brexit is well and truly being monitored by investors and speculators alike and at present the UK appears to be in a stalemate with the EU and between its own Government too.

It does seem like Prime Minister Theresa May has ‘kicked the football down the road’ and given herself some time to try and enjoy her Christmas turkey. Should there be no further political problems before the politicians go off for recess then I would expect the Pound to remain steady, ahead of a really busy and volatile start to 2019 as we approach the Parliamentary vote on Brexit.

With this in mind I would not be surprised to see a slight improvement in GBP/AUD as we nudge towards Christmas, but to see rates get extremely jittery once we enter the New Year.

If you have the need to buy or sell Australian Dollars in the coming days, weeks or months ahead and you want to ensure you make the most of your money then it is key you get in touch with us.

You can contact me (Daniel Wright) by filling in the form below with a brief description of your requirements and I will be happy to contact you personally to discuss rates now and moving forward, and to explain how I will be able to help you should you need it.

Will Pound to Euro rates drop below 1.10 before Christmas?

GBP EUR Higher After French Economy Shrinks

In this article we look at whether Pound to Euro rates could drop below 1.10 before Christmas? The big news this week is whether Jeremy Corbyn will succeed in engineering a no-confidence vote in the Government. There is growing pressure on Mrs May to come up with the goods and deliver on Brexit, or to take the matter to parliament for them to decide. This could very easily see the pound lower as the market seeks to adjust to the likelihood of further negative news.

There is a growing belief that Brexit could be delayed, cancelled or possibly given back to the people to decide. A key aspect gaining popularity is of course the likelihood of a second referendum. This is a very difficult matter to broach and might see excessive volatility for the pound as the market has to try and second guess the possible implications from this factor.

The pound is very much on the back-foot which might well see us lower if the uncertainty increases so it is well worth trying to track the news to keep up to date with the latest trends and themes. Clients with a position on GBP/EUR could see pound to euro rates drop below 1.10. I really do feel this is a likelihood now as the uncertainty for the UK’s position seems likely to persist.

I cannot see the UK or the pound benefiting from the predicted uncertainty ahead. This week will be crucial as an indicator as to what might be expected from Jeremy Corbyn and whether or not he can trigger a motion of no confidence in the Government and topple Mrs May.

Pound to euro rates could be in for a choppy period as the market sees less volatility and liquidity in the trading sessions. Investors will be less likely to wish to hold the pound as it is at risk of destabilising quickly, if events take a wrong turn.

For me, the risk still remains to the downside for the pound, if you have a currency transfer to consider buying or selling the pounds against the Euro, please do contact me to learn the latest news. You can use the form below to send me a message directly.

GBP/AUD Forecast: Will GBP/AUD rate rise or fall going into 2019?

GBP AUD Stands Still at 1.7700 without Catalyst 

Our latest GBP/AUD forecast looks at the month ahead for the Pound to Australian dollar rate. The Australian dollar weakness that has seen over 5 cents movement in a week from 1.72 to over 1.77 could be a flavour of the kind of volatility that we can now expect in the weeks ahead as we approach some key pieces of news in the currency markets.

GBP/AUD Forecast: Brexit and trade Wars key drivers for GBP/AUD rates

The key factor is of course Brexit which I will discuss later. However, this more recent movement stems from the news on Trade Wars with Australian GDP, Gross Domestic Product and other concerns around US-China trade concerns. Whilst this more immediate movement has been tempered now and GBP/AUD rates are in the 1.76s, the next week or two could see increased volatility.

The end of this week we are expecting the US Non-Farm Payroll data which can influence more global factors driving exchange rates. Clients tracking GBP/AUD rates could see some movement on the pair once this news is released at 13.30 on Friday. US economic data drives the Aussie because of the way news from the United States can influence global attitudes to risk.

The Australian dollar acts as a key barometer of global attitudes to risk and trade. It will rise and fall according to how financial markets are viewing the latest news. US-China trade wars are a major factor on this, as they influence attitudes to risk and sentiment.

The recent cooling in negative sentiment towards the trade wars had seen the Australian dollar rise and the quick turnaround on the rates highlights just how important it is to make plans in advance if considering a large GBP/AUD exchange in such a volatile market.

December 11th a key date for GBP/AUD rates

Tuesday is the key date on this pair next week with the UK’s Parliamentary vote, this will likely trigger a big move on the GBP/AUD pairing according to how it comes across. Most forecasts have sterling losing value from a no vote since this opens up all manner of potentially negative outcomes for the UK and the pound.

These include Mrs May resigning or being forced out, the possibility of a second referendum or even a general election. It does feel like the pound could be the biggest loser next week, although making predictions on such volatile events as the Brexit and Trade Wars is difficult. The politicians involved cannot make up their minds so how can you, the market or I accurately say what will happen?

If you have a position to buy or sell GBP/AUD then please feel free to make further contact to discuss your options and the market. These events will likely set the pace for 2019 so it is well worth being ahead of the curve and making plans now, rather than leaving it all to the last minute and being caught out.

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

To discuss the upcoming Brexit vote, and how it’s likely to impact GBP/AUD rates please get in touch using the form below. I’ll be happy to get in touch personally and discuss your requirements.

Pound US Dollar Forecast: Will the Pound fall even further against the US Dollar?

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

In today’s Pound US Dollar forecast I discuss whether the Pound is likely to fall even further against the US Dollar. The US Dollar has remained very strong against the Pound in recent weeks staying below 1.30 as the problems surrounding Brexit appear to be mounting.

Today will be the third day of debating prior to the proposed vote on December 11th which will decide whether or not Parliament will approve the current Brexit deal on offer by Theresa May.

Yesterday, the Government was forced to publish the legal advice it had been given about Brexit which is the first time in history that Parliament has been found in contempt.

This did not go down well with a number of MPs, and at the moment it appears as though Theresa May will be well short of the votes needed to approve this particular deal. If Theresa May loses the vote then it is likely that she will be going to Brussels on 13th December for the next EU summit to try and appeal for further concessions or amendments to the current plan.

However, there is also another chance that Theresa May could even be forced to resign if the vote shows a huge amount less than she needs.

US economic data to help the US Dollar vs the Pound

Turning the focus to what is happening in the US at the moment we could see some further US Dollar strength over the next couple of days as we wait for the release of Initial Jobless Claims data later on today.

The US economy has been showing some very positive signs recently and this provided a lot of support in favour of further interest rate hikes in the US.

Tomorrow afternoon, we could see further Dollar strength against the Pound when the US releases Average Earnings data as well as the Unemployment Rate which is expected to hit 3.7%. This is close to the lowest levels in US history.

The US Federal Reserve are due to next meet on 19th December and the expectation is for a final interest rate hike in 2018. If the jobs data for today and tomorrow comes out strong then I think we could see Pound vs US Dollar rates falling towards the end of the year.

Therefore, if you’re buying US Dollars it may be worth getting this organised in the near future.

If you would like further information about about my Pound US Dollar forecast please feel free to contact me directly using the form below and I will reply to you personally.

Should I buy Canadian dollars now?

GBP to CAD Rate: Sterling Gains Against the Canadian Dollar Ahead of Bank of Canada Statement

Its been a tough couple of days for the Canadian dollar vs Sterling so should you buy Canadian dollars now? Yesterday the Bank of Canada kept interest rates on hold at 1.75% and thereafter provided an extremely dovish statement which was a surprise to the markets.

The Central Bank stated that a sharp fall in oil prices, which will likely to have an impact on economic growth was the main concern, and the trade war between the US and China is still a concern for global growth.

Is now the best time to buy Canadian dollars?

Now that Sterling vs Canadian dollar has risen from the mid 1.60s back above 1.70, the question my clients need to ask themselves is will the Canadian dollar continue to devalue or should they take advantage of the spike in the market and buy Canadian dollars now?

Personally I believe this is a spike that is worth taking advantage of, if clients need to purchase Canadian dollars with Sterling. Across the Atlantic, UK Prime Minister Theresa May is struggling to persuade MPs to back her Brexit plan.

Reports are suggesting that she could lose the vote on the 11th December by over 100 votes and this could cause major problems for the PM. If she loses by that kind of amount I believe her position comes untenable and we would see a resignation or she will be ousted by her own Party.

A real concern for Brits moving to Canada or Brits that buy Canadian exports is the commentary coming from the Bank of England. Governor of the Bank of England Mark Carney has warned, if the UK come crashing out of the EU without a deal, house prices could crash by a third, GDP could fall 8% and exchange rates could fall 25%.

I’m confident that MPs are taking the Bank of England’s advice on board and therefore I do not fear that the UK will crash out of the EU, nevertheless the uncertainty of the deal not going through on the 11th December is a growing concern.

If you hold Sterling at present and are planning a move to Canada short term, you need to ask yourself the question now, are you prepared to take the gamble and wait until after the vote on the 11th? If she fails to get a deal over the line I believe GBP/CAD rates will fall towards the lower 1.60s and remain there for months to come.

For more information about when might be the best time to buy Canadian dollars or to discuss GBP/CAD rates in more detail feel free to drop me a message using the form below:

GBP/EUR exchange rates: Factors to look out for this week

Pound Sterling Outlook: Will the UK and EU Strike a Trade Deal and How Will GBP Perform?

There’s likely to be a busy start to December for GBP/EUR exchange rates as next week’s key vote approaches. On Tuesday the 11th December there will be a vote in Parliament regarding UK Prime Minister, Theresa May’s Brexit plan and although it’s gaining popularity the markets generally expect her to fail to gain the support she needs.

In the lead up to next Tuesday’s vote there are a number of factors that could influence GBP/EUR exchange rates in the meantime. Starting tomorrow there will be five days of debate, each day’s debating being led by a different Cabinet minister. Despite the European Union suggesting there is no scope for amendments to the text agreed by UK-EU negotiators I think talk of amendments could influence the GBP/EUR rate as the plan is unlikely to be supported, with May not getting the support she needs from her own Party, along with the DUP party who have already said they will vote against the deal. This is key as the DUP is supposed to be propping up May’s Government and the chances of her receiving the required support from the Labour party is slim.

French protests could affect GBP/EUR exchange rates

The five days of debate is likely to be a key driver for GBP/EUR exchange rates this week. From the EUR side specifically I think the troubles and protests in France are a key talking point. The protests, which begun over fuel tax increases have spread and now the protests are also about the increasing living costs in France. France now faces the largest protests since 1968 according to many with French President, Emmanuel Macron becoming increasingly unpopular.

This issue is likely to weigh on the Euro’s value so those of our readers with a Euro currency exchange to make should follow this topic closely.

This week’s economic data

In terms of economic data releases this week there will be PMI figures released at 9.30am for the Construction sector tomorrow and then the Services sector on Wednesday. Mark Carney, the Governor of the Bank of England will be speaking tomorrow which could also influence GBP/EUR exchange rates.

If you wish to be updated in the event of a major market movement, do feel free to register your interest with me using the form below.

Volatile times ahead on GBP/USD exchange rates, will the US dollar get stronger against the pound?

GBP USD Exchange Rate Slides on Disappointing PMI Numbers

GBP/USD exchange rate: Close to best rates in 2018 selling US dollars for pounds

The GBP/USD exchange rate is currently trading on the interbank rate marginally above the 1.28 level, a not wholly unfamiliar level on the pair for regular monitors of the market in the last few months. 2018 has seen just over 16 cents movement between the high and the low on the pairing with current levels exceptionally close to the 1.2692 bottom seen in August.

There are now a series of very important political events and economic releases ahead which could have a direct influence on the GBP/USD exchange rate. I think it is going to be a very choppy few weeks ahead with some large unexpected swings as the currency markets digest these key pieces of information.

Will the US dollar get stronger against the pound?

The answer to this question is that yes, we might very well see the US dollar get stronger against the pound. The pound is currently in the firing line over Brexit uncertainties and the US economy is performing very well.

The US dollar lost significant ground earlier in the year when the GBP/USD exchange rate hit 1.43, this was mainly on the expectation the trade wars with China would prove very damaging for the US economy. The current view is that actually the trade wars are not as bad as everyone first thought, and in any event, the US economy is likely to weather the storm the ‘best’. The US economy (and therefore the US dollar), will come off the least worse from any global slowdown.

The US is also raising interest rates at a fast pace with a further hike expected in December. A higher interest rate generally makes a currency more attractive to hold and therefore increases its value.

GBP/USD Forecast: Will 1.30 be broken again?

Events begin to come very thick and fast with US Inflation data released today and then it is the end of the month where we can see month-end flows of currency creating unexpected opportunities and swings on the currency markets.

The 11th of December is a key date for the diary with the latest Brexit news and the Parliamentary vote in the House of Commons on Mrs May’s Brexit deal. It appears the most likely outcome is a vote against the UK Prime Minister, which could open up all sorts of problems for the Pound and GBP/USD exchange rates.

The end of this week also sees the G20 Summit where the Chinese Premier Xi Jinping is supposed to meet with Trump and of course the trade concerns would be discussed. This is potentially a real market mover as the current tariffs of 10% might increase to 25% in January if no progress is made.

If the UK Parliament passes Mrs May’s plans and the market becomes fearful over the negative effects from the trade wars, GBP/USD exchange rates could well breach 1.30 again. However, the sentiment does seem to be more supportive of the US dollar lately so whilst possible I expect GBP/USD rates to spend more of December below 1.30 than above it.

When should I buy pounds with US dollars?

If you have US dollars to sell for sterling, you are very close to the best rates all year. Indeed with the US possibly raising interest rates and Brexit uncertainties continuing, it might get even better for you.

Of course, the currency markets are always unpredictable and whilst we can highlight the times and reasons when we might see volatility, we can never guarantee  the outcomes.

I believe there is real value in making plans in advance to ensure that you are not caught out by any sudden changes or twists in the market. This is more so the case when you have such unpredictable events like Brexit and Donald Trump to try and second guess.

Thank you for reading and I look forward to hearing from you and discussing any possible GBP/USD transfer you might have to consider.

To discuss the factors and events that could affect GBP/USD exchange rates please use the form below to get in touch. I’ll be happy to respond personally and discuss your queries.

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