Sterling Drops On Scottish Polls (Colm Gilhooly)

GBPEUR rate remains steady as markets await the Autumn Budget

Scottish Poll Causes Sterling Slide

A poll showing the vote over Scottish independence is getting tighter (with the YES campaign sharply narrowing the gap with their No counterparts) saw sterling slide against most majors.  The vote takes place later in the month and the uncertainty over what would happen to the pound, and UK businesses based in Scotland, has been weighing down sterling.  Markets do not like uncertainty or surprises as it often results in a lack of confidence and inability to forecast ahead, hence the pound being sold off.

Personally I am still not convinced that Scotland will vote yes and therefore once the vote is out of the way I expect this weight on the pound to be lifted.  However anyone expecting the pound to rocket up is likely to be disappointed as I think the pound is unlikely to gain much further until we get a clearer timescale over when and how much UK interest rates will go up.  The next Bank of England decision is on Thursday and nobody is expecting a change from the 7-2 vote in favour to hold from last month.  Inflation has dropped a touch in the UK and retail figures haven’t hit the levels expected.  Also I get the impression the BofE are reluctant to do anything that might hamper the recent economic recovery, particularly as certain sectors (namely construction and manufacturing) are nowhere near the levels they need to be to support a balanced economic recovery.

ECB Decision This Week

Carney has highlighted the strength of the pound as a possible barrier to growth (in that it will make it harder for UK exporters), and the UK deficit is still an issue, so all in all I don’t foresee a rapid increase for sterling.  On the Euro front there is the possibility that the ECB may do something to counteract low inflation and these unusual measure could seriously weaken the Euro so on that note GBP EUR rates could be very volatile.  In my view I think the current rates are a good buy in the short term, as I suspect the ECB may still take a wait and see approach, but long term I think the Euro will continue to struggle and intervention from the ECB will be inevitable.

US Non Farms This Week

Friday sees the latest non farm payroll, and I have been saying for months that the Dollar is undervalued against sterling.  US data is slowly but surely improving and at some point the Fed will give a clearer view on a more hawkish monetary policy, which should help the Dollar.  Also the troubles in the Middle East and Ukraine, the worries over what Europe may do with some form of QE, and the issues of Scottish independence for the pound have all caused a flight to safety in the good old greenback.  If news on Friday is good it could boost global confidence and further reinforce the recent recovery for the Dollar.

RBA Hint At AUD

The RBA didn’t make any change at their meeting although Governor Stevens did talk about the strength of the Aussie again which may worry some holding AUD.  With upcoming GDP and retail figures Down Under, and a lot of US news at the end of the week, it would be wise to keep a close eye on the GBP AUD see-saw as I suspect the Aussie may be near peaking versus the pound in the short term.

If you need to make a currency transfer and would like to find out more about the exchange rates we can offer, then feel free to email Colm at cmg@currencies.co.uk and I would be happy to find out a bit more about your requirements and see if we can help save you money.

Pound forecast ahead of mortgage approvals – last month saw weakness

Good morning readers and I hope you had a great weekend?

The Pound faces an intreresting morning post 09:30am as we see mortgage approvals data released for the U.K.

Last month this release came out much worse than expected and led to the Pound sliding accross the board so be sure to check back here later on this morning to see exactly what happened and why…

My personal opinion is that I would not be surprised to see the figure slightly better than expected as last month had been a shock and they are predicitng a further drop on this occasion however as always, anything can happen!

Sterling gains against the Dollar, Flat against the AUD and NZD and also loses against the Euro

The Pound has had a mixed day today gaining ground against the U.S Dollar yet losing against currencies such as the Euro and South African Rand. Rates have remained reasonably flat against the Australian Dollar and New Zealand Dollar which are usually fairly volatile currencies.

We saw that Deutsche Bank expect Australia to fall into recession in 2013 which may mean that it is coming to crunch time for those of you holding out that still have Australian Dollars to sell. here is a link with that story: http://online.wsj.com/article/SB10000872396390443855804577602552781925554.html

Head of the European Central Bank Mario Draghi has backed bond buying plans by the European Central bank which has led to a little Euro strength over the day and also is more than likely why we have seen the Pound gain ground against the U.S Dollar as investors have probably gained back a little confidence in the markets following these comments, pulled out of their ‘safer haven’ investments such as the USD and put them into riskier investments such as the South African Rand.

A decrease in demand for the Dollar following this of course then weakens the currency which may be why we have seen such shifts in trading today.

Tomorrow the most important release on the markets is in the form of the FOMC minutes over in the States, basically the minutes from the last Federal Reserve Interest Rate decision which may involve the discussions around QE3 (Quantitative Easing) and could lead to some overnight volatility depending on what has been discussed.

QE is generally seen as negative for the currency concerned however this has been fairly common knowledge that we may see QE3 at some point in the future so mentions of it being put back may actually strenghen the Dollar.

The most important release for the U.K this week is GDP or Gross Domestic Product figures out for the U.K on Friday, expectation is to see a revised figure to be slightly better for the U.K which may give the Pound a slight boost at the end of the week so if you have a foreign currency you are looking to sell then tomorrow and Thursday may be your opportunity.

For a free analysis of your position and what may move your rate of exchange in the coming weeks and months please feel free to speak with me Daniel Wright directly on 01494 787 478 or you can email me on djw@currencies.co.uk I welcome private and corporate clients of any size so do feel free to contact me today.

The slightest change in exchange rates can make quite a difference to the cost of an overseas property or the amount you will get back from the sale of one, get in touch with me today if you are in a position regarding overseas property and I shall be more than happy to assist you.

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GBPEUR rate remains steady as markets await the Autumn Budget

Good morning all, once again today will be key for exchange rates with Greece being in the headlines today.

Our latest market report can be seen on our facebook page which can be found on the link below – like the page and not only will you be kept up to date with market movements but we will also have special offers, polls and competitions on there soon!

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Sterling Euro rates close to 2 year high (Tom Holian)

Sterling Euro exchange rates have held steady this week with rates just shy of a 2 year high reached immediately after the Scottish referendum on early Friday morning.

Focus will now move back towards the UK and considerations as to when the Bank of England may look to increase interest rates. BoE governor Mark Carney has recently hinted that interest rates are likely to go up in Spring 2015.

With the US deciding to end their current tapering plan in October we could see the Dollar strengthen leading to Euro weakness. Therefore, we could even see Sterling improve against the single currency towards the end of October if the tapering finishes.

Yesterday we saw a brief respite for the Euro with German PMI services data slightly better than expected but with French & German consumer confidence due on early Friday morning we could see another good opportunity for Euro buyers.

If you would like to be kept up to date with exchange rate movements and if you have a currency transfer to make and want to save money on exchange rates compared to using your bank then  contact me directly for a free quote Tom Holian teh@currencies.co.uk

 

 

Sterling Under Pressure on the Exchange (Matthew Vassallo)

Pound Continues to Benefit from Election Optimism

Sterling has come under further pressure during Tuesday’s trading, with the Pound suffering heavy losses across the board. This has been a regular trend since the turn of the year and I am not anticipating a sustainable recovery for GBP under the current market conditions. Why we have seen the Pound lose so much value in such a short space of time is being heavily debated and I will touch on the key triggers shortly. The catalyst for today’s drop was further poor economic data released this morning, in the form of UK Markit Services figures, which came out under expectation at 53.7. This caused the Pound to slip back below 1.25 on the exchange and this move was then intensified by better than expected Retail Sales figures for the Eurozone, which is always considered a key release by investors. This caused the markets to panic and investors have likely sold off large GBP positions, which has caused GBP/EUR rates to drop perilously close to 1.24.

As mentioned GBP/EUR rates have been on a downward spiral since the turn of the year. Ironically it was the overvaluation of the Pound for much of 2015, particularly against the EUR and to some extent the USD, that has caused many of the issues facing the UK now. The pound was driven up due to the complete lack of confidence in the Eurozone and the decision by the FED not to raise interest rates until late last year. GBP/EUR was pushed north of 1.40, whilst GBP/USD rates were trading comfortably above 1.60 for a sustained period. When you look at the effect this had, particularly on GBP/EUR it easier to understand why we have seen such a drop.

The fact the Pound was so overvalued caused our exports to fall, which in turn put pressure on our Construction & Manufacturing sectors. The Bank of England (BoE) then had to change their stance and have been actively talking down the UK recovery, with the hope this would artificially drive Sterling’s value down and boost that facet of our economy. We have also seen a run of very inconsistent economic data and this has caused investor confidence to dissipate and add to this the on-going debacle regarding the UK’s future participation in the EUR and the upcoming referendum in June and it becomes easier to digest.

I feel it is likely things will get worse before they get better and whilst the current trend won’t last forever, the key question is where we finally see GBP bottom out. It is not beyond the realms of possibility that Sterling’s value will continue to tumble up until the referendum and then we will be questioning how much of a recovery we will see. I would look protect myself against further losses and gauge any longer-term positions based on market developments over the coming months.

If you have an upcoming GBP currency requirement and would like to be kept up to date with all the latest market developments ahead of your transfer, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478. You can ask one of the reception team for Matt, or alternatively I can be emailed directly on mtv@currencies.co.uk

Revised UK GDP at 09:30 likely to be the driving force behind the pounds moves today (Mike Vaughan)

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

Anyone looking at GBP/EUR should watch out for revised UK GDP data at 09:30 BST. With a recent good run of data from the UK this is forecast to be positive and should lend support to the pound, of course if the figures are not as strong as forecast then the pound is likely to de-value. Should you be looking at GBP/EUR short term then you may wish to look at your position before 09:30.

Following the FED minutes on Wednesday EUR/USD has remained fairly flat at 1.335. As mentioned the minutes did little to indicate when the FED will look at tapering but did suggest some members favoured swift action. For me it is something that is likely to occur sooner rather than later and I would expect this to push EUR/USD towards 1.30 in the coming weeks. I would also expect this to have an impact on GBP/USD and wouldalso expect a shift towards the 1.50 – for me anyone buying USD should consider the prices available now.

Looking at the loonie (GBP/CAD) the CAD has been weakening as the prospect of the FED tapering QE weighs in the riskier currencies. This has also hindered the AUD,NZD and ZAR creating some good buy opportunities. For the CAD these are the best levels we have seen since February 2010 and represents a strong buy opportunity in my opinion. The CAD historically, and certainly over the past few years, has been a relatively stable currency and having shifted in excess of 8 cents in three weeks this is to me represents an opportunity.

Should you wish to discuss an upcoming currency exchange you are looking to arrange and would like to know how the currency service we provide operates then please get in touch. We are simply here to help our clients maximise their exchange and better prices offered by the high street banks and other financial institutions. To find out how we can help you with your currency exchange please contact the office on 01494 787478 or email Mike at mgv@currencies.co.uk

 

Pound Sterling Forecast – The week ahead (Daniel Wright)

Pound to US Dollar forecast Bets increase on 50 basis point interest rate cut from the Fed What could happen to GBPUSD?

This week seems much busier than in terms of economic  data with the following due out that may have an effect on exchange rates:

Overnight we have the RBA (Reserve Bank of Australia) Interest rate decision and although no major changes are expected regarding interest rates speculators and investors alike will still be focused on any comments in the RBA rate statement which may give us some insight on future economic policy over in Australia and may lead to a volatile Australian Dollar overnight.

Tomorrow morning brings Swiss inflation data at 08:15am with expectations for CPI to be at 0% this does bring in a slight risk of deflation which may then lead to the SNB having to step in and combat inflation issues a little further down the line much like the European Central bank have had to recently. This may be negative for the Swiss Franc.

Later on tomorrow morning at 09:30am we have industrial and manufacturing production figures for the U.K which can always be a good market mover. Expectations are for a slight improvement in these figures so we may have a positive morning for the Pound as long as  long as figures are released in line with analysts predictions.

Wednesday is a little quieter however later on Wednesday evening we have the FOMC minutes from their last interest rate decision over in America and with U.S data having an effect on global attitude to risk all major currencies may be in for a volatile evening. I would be surprised not to hear some sort of indication on the interest rate hikes and when they now may happen so be sure to keep an eye on exchange rates at around 18:00pm Wednesday evening.

Late night Wednesday/Early morning Thursday we have a flurry of employment data from Australia and expectations are for fairly poor figures to be released, all in all this could round off what may be a potentially poor week for the Australian Dollar.

At midday on Thursday we have the Bank of England interest rate decision and although it would be a great surprise to see an interest rate hike in the U.K it only takes another two members of the Bank of England to decide in favour of a rate hike and we may see a surprise rate hike. A rise in interest rates is genreally seen as positive for a currency and a cut negative so if this were to happen you could expect a boost in the value of the Pound. Personally, I would be surprised to see a rate hike but you can never rule it out.

If we do not see one then the Bank of England minutes from this meeting will be released in roughly two weeks time and they will no doubt attract quite a bit of attention to see how voting went.

Later in the day Mario Draghi speaks at 16:00pm and we may see further news on he plans to attack deflation in the coming months so expect Euro volatility during Draghi’s comments.

Friday is not too busy to round off the week, the two key releases will be trade balance figures for the U.K at 09:30am where we expect to see a small improvement and later on in the afternoon we have Canadian employment figures with little change expected.

All in all I expect a busy week  and hope to have plenty to write about as the week goes on. If you have a currency exchange requirement either soon or in the future and you want to make sure you not only get an award winning rate of exchange but also customer service to match then feel free to contact me (Daniel Wright) the creator of this site personally.

You can email me with a brief explanation of what you are looking to do and a contact number and I will be more than happy to give you a call.

I am contactable on djw@currencies.co.uk and I look forward to speaking with you.

 

 

How will today’s Autumn statement effect sterling exchange rates? (Ben Amrany)

The most eagerly awaited announcement of the week will start today at 12.30 as the Chancellor will give his Autumn statement. The Autumn statement will give his views on the outlook for the UK economy, the state of the public finances and what that means for the government’s spending plans and programme of austerity measures.

The good news from the statement has already been released: An extra £5bn investment boost will target – construction, Schools, transport, health and other capital projects.

The worry for those of you that are looking at selling the pound could come to fruition when the chancellor will reveal the true state of the nation’s financial health.

Growth forecasts and further austerity cuts, I think this will be key to how the pound performs for the rest of the week. It is extremely unlikely that we will see further growth as we are in one of the longest and deepest recessions in generations.

The Office for Budget Responsibility (OBR) predicted in March that we would see 0.8% growth this year, 2% next year and 3% growth by 2015. It is looking more and more likely that they will downgrade their growth forecasts. If this happens then My view = Sterlingweakness.

We have heard rumours this week that the Chancellor has missed his targets to cut the deficit. This is going to be embarrassing for the government and could cause friction within the coalition. Plus if missing targets raises concerns about the UK’s credit worthiness, it could become more expensive for the government to borrow money and put pressure on the UK’s credit rating going forward.

We will find out today how much more austerity he will now impose and for how long it will last. I expect big cuts to departments and services while potential hikes in specific tax. If this happens once again I expect it to weigh on the pound now and well into the New Year bringing GBP/EUR rates down towards the 1.20 level in the next month.  My View -Sterling weakness.

So today will certainly be interesting to see how the markets react to the Chancellors comments. Moving on to tomorrow their are big interest rate decisions here in the UK and the Euro zone. So if you have a requirement to sell the pound you may wish to look at securing your funds before today’s announcement. This will give you the peace of mind on what is surely going to be a volatile end to the week.

Plus if you are looking at buying Euros then be cautious as the Euro has significantly strengthened against a basket of currencies this week on teh back of Greece buying back some bonds and reducing their deficit. Euro zone GDP is out tomorrow too so if their economy does not shrink as much as anticipated then the Euro strength may just continue.

If you have a requirement a to buy or sell any major currency please feel free to contact me at bma@currencies.co.uk  with your requirement and I will be happy to go over all the options that are available to you. the authors here at www.poundsterlingforecast.com  work for one of the largest currency brokers in the UK. Not only will we give you our expert opinion but we will help you try to maximise your exchange by offering you a significantly better rate of exchange than  that of your high street bank.

Pound weakens from BoE minutes, long-term forecast bleak (Joshua Privett)

GBPEUR rate remains steady as markets await the Autumn Budget

My previous post from the initial release of the Bank of England interest rate decision and minutes from their latest meeting noted that Sterling weakened against most major currencies at the beginning of the afternoon. This was due to the overwhelming consensus to keep interest rates on hold. What compounded this was the minutes from the meeting which painted a bleak outlook for the UK’s future timeline for raising rates as well.

It wasn’t a negative view of the UK economy as such. Concerns were made about inflation, with core inflation not expected to even hit half of by the BoE’s target rate of 2% by spring 2016, as well as the struggling construction and manufacturing sectors. But employment is still at fantastic levels, with our 5.4% rate of unemployment much better than the historical average of 7.22% since the 70’s, and growth expected to be 2.4% GDP for 2015.

But currency value isn’t simply a reflection of the current state of the economy. It’s about net flows of currency and there seems to be little on the horizon to make Sterling more attractive to purchase.

The minutes from the meeting highlighted that the UK economy is almost at ‘capacity’. This suggests that while positive data will continue to come in, there will be no gains to bolster confidence in the currency in question. For example employment figures may still be high but without the headline news of a fall in the actual unemployment rate itself it is unlikely that Sterling will shine on the markets in the short-term for October.

Furthermore, the continuing concerns about China and global slowdowns were expressed in the report. This has likely delayed the timeline for the UK to raise interest rates further, as this continuation of concern from the last report shows that this will be an ongoing brake for the BoE’s plans to change financial policy.

The only reason Sterling didn’t fall further today, was due to minutes released from the European Central Bank’s latest meeting which showed similar concerns. Which is why the afternoon slide on GBP/EUR halted at 1.356 from highs of 1.363.

With these long-term concerns I believe that the current market presents some excellent opportunities to use Sterling as a buying currency compared to where rates may be by next month. 

I strongly recommend that anyone with Euros to buy should contact me overnight on jjp@currencies.co.uk to receive a competitive quote on any planned transfers, and my advice on how to strategize any imminent or future transfers. Those concerned about where rates are going should know that these levels can be fixed to avoid further movements in your favour. Unfortunately Sterling’s sustained slide over the past few months isn’t showing signs of abating. 01494 787 478

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