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Pound Sterling Forecast – Is this the calm before the storm?

By
Daniel Wright
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For those of you that have been following the markets lately you will be well aware that Sterling has remained fairly flat and has remained in a tight range against most major currencies. In fact, last week was the least volatile week for Sterling exchange rates we have witnessed since February 2016.

Although this is frustrating for those of you waiting for that market spike in your favour, at least the rate has not moved against you too much, which could easily have happened with ongoing Brexit talks, political tensions and lots of economic data.

The rest of the week is fairly quiet for U.K economic data but do be wary that there are many releases from around the globe and various other factors that could still have quite an impact before the end of this week.

EU Summit and lots of market data out next week

Next week brings the widely anticipated EU summit, where the Brexit transition period will be one of the main matters on the agenda. I would expect various comments and releases throughout the summit and even the slightest hint of progress or issues could lead to Sterling either gaining or losing value very quickly depending on how it is taken by the markets.

So far we have not seen any major hiccups from Brexit negotiations but it does still remain a potential banana skin for Sterling exchange rates, equally good news would more than likely give Sterling a boost. The summit is held on March 22nd and 23rd (next Thursday and Friday) so be wary of not only these dates but each working day from here forward as you do tend to see the markets move in advance of events like this as investors and speculators alike try to second guess the outcome.

We also have U.K inflation data on Tuesday, unemployment and average earnings figures on Wednesday, Retail Sales and the Bank of England interest rate decision on Thursday.

All in all this presents the potential for an extremely volatile week of trading next week, if rates are at an affordable level at present it may make sense to consider either some or all of your pending requirements unless you like to take a gamble, if you are in the position where you can afford to roll the dice and take the risk next week then just be prepared to move fast and make sure you make us aware of your needs so that your dedicated point of contact can call you if an opportunity arises or should the market move against you.

Feel free to get in touch with me (Daniel Wright) directly by emailing me on djw@currencies.co.uk and I will be more than happy to contact you personally with a live currency exchange quote and to help you tailor a game plan for how to approach your pending exchange.

Pound rallies as the Bank of England leave rates on hold – Boost for Sterling exchange rates (Daniel Wright)

By
Daniel Wright
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Pound to US Dollar Rates and the impact of the Mid-terms elections

Today we have seen the Pound gain value against every major currency following the Bank of England members voting 8-1 to keep interest rates on hold.

An interest rate cut had been expected by the financial markets and somewhat priced in so the fact that this did not happen led to the Pound gaining back some of the value it had lost.

For anyone looking to buy foreign currency this is a welcome result as your up and coming currency purchase has just become a little cheaper! One word of warning is that Mark Carney did state that easing would more than likely have to happen next month so don’t feel like we are not going to see an interest rate change or other easing bought in, it has just been merely delayed for the time being.

I would imagine the recent change in the political position has had an impact in this decision and that the Bank of England now wish to hold fire on making any sweeping moves to see how the land lies once the dust has settled.

We deal a lot with clients looking to buy or sell overseas property and I had a good long chat with the managing Director of Girasol Homes, a property finder for clients looking to buy property in Portugal and Spain (they do also cater for those looking to sell). We discussed the current market conditions and everything really is a lot more positive than many people have been led to believe out there in the overseas property market.

Those looking to sell have seen a welcome boost in the value of their Euros should they need to bring money back into GBP and those looking to buy  are only a few cents from the rolling ten year average for GBP/EUR so the market really isn’t in that bad a place. Those buyers that do have concerns about market conditions could also approach the possibility of hedging their position a little with a mortgage, this appears to be an inceasingly popular approach.

Should you be looking to buy or sell in Spain or Portugal and you would like to speak with Nigel about the market or how he will be able to help then feel free to visit www.girasolhomes.co.uk or email him at nigel@girasolhomes.co.uk quoting Pound Sterling Forecast so he knows where you found him.

Back on the currency front we have a fairly quiet day for most currencies now but overnight we have Chinese growth figures which should impact the Australian Dollar, and European inflation/trade balance figures at 10:00am tomorrow.

Mark Carney, Governor of the Bank of England is speaking tomorrow at 1pm so for anyone with an interest in buying or selling Sterling it would be well worth you getting in touch with us directly so that we can keep you in touch with the action.

Not only do we ensure clients get up to the minute market news but we all work for a brokerage turning over roughly a billion pounds worth of currency a year, meaning we could probably get you a better rate of exchange than your current provider or bank due to our buying power.

If you would like to get a quote or to find out more information about our award winning rates and customer service then feel free to email me (Daniel Wright) directly on djw@currencies.co.uk and I will be happy to get in touch personally.

Where Next for Sterling Exchange Rates

By
Matthew Vassallo
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It’s been a quiet day for the Pound on the currency markets, with little movement against both the EUR and USD. GBP/EUR rates continue to float around 1.21 on the exchange and the markets seem to be waiting for guidance before making their next decisive move. With concerns over France’s economic health and the very real threat of deflation hanging over the region, you can make a very good case that Sterling is more likely to find further market support from its current position than the EUR.

However, there is a is a case to be argued that the EUR, when considering its recent history against GBP, has far more scope for improvement than the Pound. If the negative issues raised earlier in this post can be resolved then you do feel the EUR could go on a run and break back through 1.20 for a sustained period.

Personally I feel GBP will continue to be well supported in the market, in line with the improvements we are seeing in the UK economy. Any move towards 1.25 against the EUR is likely to find market resistance but it will be difficult for the EUR to make a decisive move under 1.20, based on the current market conditions.

We have seen a positive spike during Tuesdays trading against both the AUD and NZD, following loses against both currencies last week. With China’s economy starting to show signs of improvement and their demand for Australia’s raw materials once again starting to increase, we may find the AUD can gather market support over the coming weeks and help to control Sterling’s recent gains.

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 directly at mtv@currencies.co.uk.

GBPEUR down again but how can the Euro survive so strong? “EURO IS DOOMED” (Steve Eakins)

By
Daniel Wright
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Saxo Bank CEO says that the “Euro is Doomed”. In an interesting inverview over the weekend by the CEO of the SAXO bank some intersting commentry was made. He went on to say that the recent rally is a illusion and that the euro will fail because there is still no fiscal union.  Right now we’re in one of those fake solutions where people think that the problem is contained or being addressed, which it isn’t at all.” AS regular readers will know the euro has gained nearly 6% against sterling since the beginning of the year. You can understand some of his arguments. As the Eurozone contacted 0.3% this year and the European Central bank Mario Draghi said only a week again that its strength risks growth and inflation.

So how does this work?

How can the euro gain when the economies of Germany, France and Italy all shrank more than estimated in the 4th quarter. They have recently been trying to finalise a bailout for Cyprus and Greece while in the back grown there is political scandal in Spain and an election contest in Italy.  France may be the biggest worry as investments are dropping, unemployment climbs and pressure from elsewhere in Europe asking for
money to bulk up other economies. The economy Eurozone is on the brink of the 3rd recession in 4 years.  The simply answer is the preserved strength of the economy compared to its position last year when many were worrying that Europe would fold.

So what next for exchange rates?

Well today (Monday) has been a quiet day as the US is closed.  AS we are nearing the end of the month data releases are thin however don’t think that the market will be quite as a result.  Wednesday and Thursday are the busiest days with releases on UK unemployment, Bank of England minutes, US Production Price Index and European Manufacturing data.  Along with that we also have news on EU public sector debt, this has been climbing at a HUGE rate. In 2008 it was at 40% of GDP and its updated forecasts are thought to have climbed up to 97.1% I worrying story for the long distant but probably not a huge mover this week on currency exchange rates.

How can you maximise the markets?

Timing the trades you have will be key to get the most out of the market. So make sure you are using a pro-active broker like ourseleves to keep you posted of every update.  You need someone with your position in mind to assist with the trade.  Here we also offer aware winning exchange rates which continually beat that of the price offered from the bank and other currency brokers. I would urge anyone with a currency need
that is looking for the best price to compare theirs to us here. It will take you just minutes and could save you thousands!  For more information and assistance please contact us on the normal number or via email at hse@currencies.co.uk

Thank you.

 

Sterling Slides Following Draghi Comments (Matthew Vassallo)

By
Matthew Vassallo
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GBPEUR rate remains steady as markets await the Autumn Budget

Sterling’s value has plunged against the EUR during Friday trading, with the single currency spiking by almost 2 cents at the high. This move has pushed GBP/EUR rates back below 1.40, proving once again how quickly market conditions and sentiment can change. Earlier this week we saw Sterling’s recent momentum against the EUR continue and with mixed reports surrounding Greece the markets seemed unsure which direction to take.

The catalyst for today’s EUR improvement is likely to be European Central Bank (ECB) president Mario Draghi’s comments during his press conference earlier today. He told the world’s central bankers that the current economic conditions inside the Eurozone had improved and it was looking “brighter today than it has done for seven years”. These comments immediately brought market support for the single currency and although the Pound has moved back above 1.40 this afternoon, I do feel the current levels should be taken advantage of if you have EUR to buy.

Despite these losses against the EUR the Pound has held its position against the USD and with rates back above 1.55 the Pound has certainly found some support following a tough couple of months. Cable rates had moved back below 1.50 recently but with uncertainty over when the US FED will raise interest rates, along with an inconsistent run of economic data, the Pound has managed to claw its way back up to the current levels.

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 directly on mtv@currencies.co.uk

Selling Euros? Sterling falls on the back of poor industrial production figures.

By
Daniel Wright
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The pound has had an extremely volatile couple of days. Yesterday sterling exchange rates were boosted to a week high against the Euro and USD after positive services figures hit the market in the morning. A PMI figure of more than 50 indicates expansion of purchasing activity, meaning this could be a sign of further economic recovery.

But before we all get to exited regarding the above this morning the pound has losses around 0.5% against most majors. This was due to a surprise fall in industrial production for February. British industrial output was down by 1.2% in February, figures from the Office for National Statistics showed.

This has now left us believing that a rate hike this week by the Bank of England is a very long shot and the pound has suffered on the back of it.

With two extremely different days for the pound it will be interesting to see what happens on Thursday with teh interest rate decision. I personally feel that we could see sterling trading in the early 1.13’s or worse against the Euro if the ECB raise interest rates and to hover between 1.6150-1.6350 over the next 3-4 days against the greenback.

If you are buying a property abroad, have business transactions to carry out or need to get money overseas for any other reason and want the best exchange rates, just fill in the form on the right hand side and one of the experienced traders that write on this blog will be in touch shortly.

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

By
Daniel Wright
-

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

 

Sterling exchange rates – A volatile day to say the least (Daniel Wright)

By
Daniel Wright
-
GBPEUR rate remains steady as markets await the Autumn Budget

Well I had mentioned at the start of the week that today would be the day to watch out for and it certainly did not let us down.

I started the day with a full order book of clients wanting particular rates of exchange and a large majority of them managed to achieve just what they were looking for.

The GBP/EUR rate had a high/low range of over three cents, GBP/USD 2 cents, GBP/AUD and GBP/NZD almost 4 centsand GBP/CAD almost four and a half cents.

The European Central Bank was the main focus and from the interest  rate decision at 12:45pm onwards the market went completely bonkers.

The ECB actually made a cut to deposit rates and added the their QE program, this led to Euro weakness for a short period of time, in all honesty it did then look like this may be the trend for the rest of the day…. then head of the European Central Bank Mario Draghi started to speak at his press conference.

Draghi came out with extreme confidence in how things are going and shocked the markets by confirming that he did not feel that anything further would be needed after this latest move. These comments led to a huge turnaround for Euro exchange rates and the Euro managed to claw back three cents in a could of hours which is a huge disappointment for those looking to buy an overseas property or businesses looking to purchase goods from Europe in the coming weeks or months.

Because of the huge surge for the Euro, a lot of money came out of the Dollar so the Dollar weakened quite significantly as EUR/USD is the most traded currency pair in the world.

On top of this, we saw a huge impact for the commodity currencies as global attitude to risk altered and the AUD, NZD and CAD all weakened off, creating a great opportunity for anyone looking to send money over to these countries in the near future.

Tomorrow should be a little quieter on the markets as there is a lot less out in terms of economic data but you must be aware that the market is always open to a surprise or two popping up.

Here at Pound Sterling Forecast we do not only help clients with market information but all of us work for one of the largest currency brokerages in the U.K. We like to work on behalf of our clients and generally act as their eyes and ears on the markets, whilst ensuring that we get them access to the highest level of exchange rates hat we can. It is extremely rare for us not to significantly better a banks exchange rate or to beat any other brokers exchange rate and we like to think our customer service is second to none.

We have a range of contract types inclusive of a forward contract, limit order and stop loss contract to suit your needs, all of which at no extra cost to you.

If you have a currency exchange to carry out in the near future involving buying or selling the Pound, no matter if you are in the U.k or not then it is well worth getting in touch with me (Daniel Wright) personally. You can call me during our trading hours of 08:30am – 18:00pm or email me directly on djw@currencies.co.uk with a description of your needs and i will be happy to get back to you as soon as possible.

 

GBP/EUR rates set for continued pressure this week (Joshua Privett)

By
Daniel Wright
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The tail end of last week saw GBP/EUR rates cannon back down following the announcement of alarmingly poor construction data for the UK economy which will have far-reaching implications.

The figures which were finally gathered together for August saw the construction sector contract by 4.3% in the month alone, the biggest such fall since 2013.

Housebuilding fell by 3% as well, a worrying statistic since the Government have been trying to raise this figure to meet their 200,000 new homes per year target to keep up with demand.

The reason why this data had such an exaggerated effect on GBP/EUR exchange rates was because this news has likely delayed an interest rate rise in the UK even further towards the back-end of 2016. We cannot raise rates if the housing market is already beginning to flounder. Credit will become more expensive and the housing market may stall completely.

With poor news for the UK in the short term which also diminished the chance of positive news on the horizon, GBP weakness followed, and now GBP/EUR is in the lower 1.34’s.

We will also have inflation data for the UK economy out on Tuesday this week, which is strongly connected to our timeline for raising interest rates as well. This has been a regular poorly performing area for the UK economy, with inflation at it’s lowest levels since records began recently. While data may come in positively, it seems more likely we will see a poor data set to re-affirm the currently unflattering perceptions on the Pound and compound the current negative GBP/EUR trend. We may see 1.33 for the first time in this half of 2015, presenting even more tempting opportunities for anyone looking to sell Euros.

I strongly recommend that anyone with Euros to buy should contact me on jjp@currencies.co.uk to discuss a strategy on how to buy at the highest exchange rates possible before this data release on Tuesday. I am happy to offer a free quite on your transfer. 01494 787 478

Will Sterling continue to Strengthen? (Daniel Johnson)

By
Daniel Johnson
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Be wary if you have high expectations for the Pound

The Pound saw some significant gains last week following positive news surrounding Brexit. Exit talks will be the key market mover fro Sterling for the foreseeable future. We saw several catalysts for Sterling strength, the first of which was Lord Jim O’Neill, former Chairman of Goldman Sachs who had a very positive outlook regarding Brexit, saying the UK will recover quickly following exit due to Britain’s strong economic back bone.

There was then news from Dutch and Spanish finance ministers that they would be forthcoming with a deal for the UK ,a stance which was followed by German Chancellor, Angela Merkel. This caused one  of the most significant spikes for Sterling as Germany is considered the engine room of the Eurozone. The German’s heavy reliance on the UK for vehicle exports could have forced her hand, but this is good news for all involved.

The US also showed willing with Treasury Secretary, Steven Mnuchin stating the US “very supportive of the UK over the Brexit issue.”

Be wary of hanging on for further gains however, We saw a contraction against the majority of major currencies following news that any new laws implemented up to 31st December 2020 could not be declined by the UK. This could cause Phase two of Brexit talks to become even more problematic than expected.

If you have to move short to medium term purchasing Euros with Sterling I would not set an Interbank target of higher than 1.15. It seems to be somewhat of a resistance point, retracting quickly whenever it is breached. 1.15 has been the highest level for GBP/EUR in the last nine months.

GBP/USD is currently sitting at 1.41, tempting if you are a US Dollar buyer. The highest levels since the Brexit decision were achieved last week when GBP/USD struck 1.4321.

Even though some of the levels mentioned were only available for a very small window many of my clients were able to take advantage of the situation when the market hit these levels. We have rate alerts and contracts available which means should your buying level become available you will not miss out.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker when the market is currently so hard to predict. If you let me know the details of your trade I will endeavour to produce a free trading strategy to suit your individual needs. Have faith knowing you will be dealing with a brokerage in business for over 16yrs, Foreign Currency Direct Plc. We are a no risk entity as we do not speculate on the market and we are registered with the FCA. If you have a currency provider take a minute to send over the rates they offer and I am confident I can demonstrate a significant saving. I can be contacted at dcj@currencies.co.uk . (Daniel Johnson) Thank you for reading.

 

 

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