Euro Rate Forecast

Currency experts forecast on the Euro

How much further will the Euro weaken?

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The Euro has been weakening as concerns mount over Italian debt levels which saw bond yields on Italy’s government debt jump to levels not seen since 2014. With the current yield (return) on the debt at 3.7% at its highest this week, the Euro has weakened quite dramatically which has caused a weakness on the Euro.

The yield is essentially the return investors will get for investing in the debt and the riskier it is, the higher the price that this will rise. Any move above 4% would likely spark fears over other Eurozone economies, a report in the Financial Times today suggests that this level could be a ‘tipping point’ for other concerns.

As a mark of just how far the concerns have come, we have seen this yield rise from below 2% when the new coalition took power in May. This is quite a dramatic turnaround in a short space of time and helps explain why the Euro has been sold off and what troubles could lie ahead in the future.

Economic issues will also take precedence as we get closer to the 25th October, this is the next ECB, European Central Bank, meeting where we will learn of some of the latest news relating to their economic plans. The Euro might well come under some further pressures in the weeks ahead because of this, it might be that the Italian issues force the ECB to scale back some of their plans.

Political concerns in the Eurozone are also around owing to some of the issues remaining in Spain. Expectations for the Euro are likely to remain troubled in the weeks ahead and this might well put more pressure on the single currency.

If you are looking to buy or sell the Euro then we have some very interesting developments ahead for the Euro, as well as its counterpart currencies. An example would be GBPEUR where Brexit appears to be taking shape which has helped the pound to a 3-month high against the Euro. And against the US dollar, continued US confidence over higher interest rates has seen EURUSD fall to 2 month lows.

If you have a position buying or selling Euros and wish for some information on the best timing and strategies to help maximise any currency position, please do contact me directly on jmw@currencies.co.uk.

Thank you for reading and I look forward to hearing from you and discussing this most interesting of currency markets soon.

 

 

 

Jonathan Watson

Brexit talks key to GBP/EUR value (Daniel Johnson)

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GBP/EUR – GBP/EUR will largely be dictated by Brexit. Investors are still reluctant to purchase the pound due to the lack of clarity surrounding Brexit. While there is still the prospect of a “no deal” I feel the pound will have difficulty making any significant gains.

The key points of contention are the Irish border and access to the customs union. If their is clarity provided on either of these matters I would expect Sterling make significant gains. Sterling is chronically undervalued considering pre-Brexit GBP/EUR sat above 1.42.

I expect volatility as talks intensify with both sides pulling out all of their ammunition in an attempt to get the best deal for their respective sides. I think the EU are making things particularity difficult, not only for monetary gain, but also to warn off other EU members leaving. A domino effect could cause the EU to collapse.

If you are sitting on Euros I would take advantage of current levels, despite the posturing I feel a deal will be put in place. I do not think it will be before the 18th October deadline, it is an open kept secret that there will be an emergency summit in mid November to get a deal in place.

I think there is potential to achieve better levels for Euro sellers between now and a deal being agreed, but looking at risk vs reward I would not be gambling.

If you have a currency requirement I will be happy to assist. If you let me know the details of your trade I will endeavor to produce a free trading strategy. During a period of such uncertainty it is important to be in touch with an experienced broker if you wish to maximize your return. We have tools at our disposal to make sure you do not miss out if there is a spike in your favour.

If you already have a currency provider in place. Drop me an email with what you are being offered and  I am very confident I will be able to demonstrate a significant saving. It will only take you two minutes and I am  sure it will be worth your while. You can trade in safety knowing you are with a Foreign Currency Direct PLC, a firm trading for over 16yrs and FCA registered.

If you would like my help feel free to email me at dcj@currencies.co.uk.

Thank you for reading.

 

Daniel Johnson

Pound to Euro rate breaches 1.12, is a move up to 1.13 now on the cards?

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The Sterling to Euro exchange rate has breached the 1.12 level today, recouping much of the losses from last week on Friday. The sell-off last week was triggered by UK Prime Minister, Theresa May when she held firm in her plans for Brexit and suggested that the EU would need to put forward some ideas.

With the UK ‘s and the EU’s negotiators now at loggerheads regarding the Brexit deal, many are expecting to see the Pound fall but at the moment its defying expectations, with the pound climbing against all major currency pairs today. The currency is actually best best performer over the past 24-hours.

The gains today are being attributed to talk of the EU being prepared to make a ‘special case’ regarding the Northern Irish border. This matter has been a key talking point for some time but the topic is surfacing more often now that the UK’s divorce from the EU is closing in. Much of the price movement for the pound is being driven by Brexit related news as well as politics in the UK and in Europe. Despite this, the Pound did gain in value somewhat after comments from the Bank of England this week. Gertjan Vlieghe of the BoE commented that he expects to see 1-2 interest rate hikes from the BoE on an annual basis, which the next hike coming as soon as August 2019.

GBP/EUR has been trading within thin volumes recently, but I’m expecting to see a major move once the Brexit scenario is clarified.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Joseph W

What factors are currently influencing the Pound to Euro exchange rate?

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The GBP/EUR exchange rate had a busy day yesterday, as the we saw the pair hit a 2-month high along with seeing a slight sell-off in the afternoon owing to Brexit related updates.

The inflation figure for the UK in August unexpectedly jumped to 2.7% after the markets were expecting to see a figure of 2.4% released. This boosted the Pound’s value as the chances of further interest rate hikes from the Bank of England are supported by this data release, which is considered a GBP positive.

Then in the afternoon after GBP/EUR had hit it’s 2-month high , getting closer to 1.13 at the interbank level we saw much of the earlier gains reversed and was because the UK’s Prime Minister, Theresa May rejected the EU’s most recent proposal regarding the Northern Irish border. This matter is becoming a contentious issue that neither side seems prepared to give any ground on, and I expect it to continue to drive the Pound to Euro exchange rate when there are updates.

As of yesterday evening there is a 2-day informal meeting in Salsburg, Austria between the EU members and I expect Brexit to be a talking point. Any updates are likely to result in currency fluctuations so it’s worth being aware of this if you’re planning on making a currency exchange in the short term future.

Later this morning there will be a release of data from the UK in the form of Retail Sales data. Drops from the previous months figures are expected and do get in touch if you wish to be updated regarding this release.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Joseph W

Will the Pound to Euro rate continue to see support at 1.12?

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The Pound to Euro rate has once again bounced off of the 1.12 mark so far today, which is a trend we’ve seen repeatedly this week.

Just yesterday the Bank of England (BoE) voted in favour of keeping interest rates on hold, as did the European Central Bank (ECB) although the pound climbed afterwards after some positive communications regarding wage growth in the UK. Should this area of the economy continue to strengthen I expect further interest rate hikes from the BoE next year, which is perhaps why we saw Sterling climb after the BoE decision.

This morning Sterling is under some pressure which is why 1.12 was tested again between GBP/EUR. The Governor of the Bank of England, Mark Carney yesterday warned that if there is no deal in place when the UK leaves the European Union, there could be a house price crash in the UK along with another financial shock through the economy.

Carney met with senior ministers yesterday to discuss the effects of a disorderly exit from the EU, and his prediction of a worst case scenario is a 35% drop in property prices over three years. He has made similar commentaries in the past and the Bank of England is carrying out stress tests in case of a no-deal and also releasing notices aimed at business and the public to prepare them for a no-deal scenario.

Brexit related news is the main mover of Sterling exchange rates at the moment and I expect this to continue especially now that time to agree a deal is running out.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Joseph W

Barnier statement causes Sterling strength (Daniel Johnson)

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GBP/EUR – We have seen gains for Sterling in the last 24hrs due to chief EU Brexit Neogitiator, Michel Barnier’s comments. He stated that it was realistic that a Brexit deal could be in place in 6-8 weeks. We saw GBP/EUR hit a several week high of 1.1241.

Personally I feel this is no great shakes it differs very little from the current Brexit time  line, although it does show a willingness to get a deal in place. I do take what he says with a pinch of salt following his recent comments , he had said that the UK would be looking at a bespoke deal which caused a Sterling spike and then he quickly retracted his comments and Sterling fell.

I think while there is still the possibility of a “no deal scenario” the Pound will not make significant gains against the Euro. Trade secretary, Liam Fox has sad he field there is a 60% chance of a “no deal” and Reuters are at 25%.

QE – Quantitative Easing is pumping money into an economy in order to stimulate growth. The European Central Bank have indicated that the current QE program pumping in billions per month will cease by the end of 2018. This could change however and QE could be extended. Growth and inflation data has been poor, if this continues QE could be extended. On Thursday following the ECB interest rate decision a press conference will be held and future monetary policy is discussed. If a hint is given away about a QE extension we could see the Euro lose value, please note however this is a long shot, but investors will be waiting with baited breath.

If you have a currency requirement I will be happy to assist. If you let me know the details of your trade I will endeavor to produce a free trading strategy. During a period of such uncertainty it is important to be in touch with an experienced broker if you wish to maximize your return. We have tools at our disposal to make sure you do not miss out if there is a spike in your favour.

If you already have a currency provider in place. Drop me an email with what you are being offered and  I am very confident I will be able to demonstrate a significant saving. It will only take you two minutes and I am  sure it will be worth your while. You can trade in safety knowing you are with a Foreign Currency Direct PLC, a firm trading for over 16yrs and FCA registered.

If you would like my help feel free to email me at dcj@currencies.co.uk.

Thank you for reading.

Daniel Johnson

Best rates to sell Euros for pounds in 2018!

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The Euro has continued its rise against the pound finding better ground against the British currency on continued fears over a hard Brexit. The latest news is that President Macron in France has been very unsupportive of Theresa May’s plans to promote her Chequer’s plan as the way forward in these negotiations.

Expectations for the Euro are that we will see further improvements in the future as continued economic might and also strong political will, continues to present investors with reasons to be positive over the future. With the UK under the strain of Brexit uncertainties there is a real chance that the pound will remain weak and whilst the US dollar is performing well, there is a real chance here too, that political uncertainty from the Trump administration might make the Euro a more positive currency to be holding.

Key information this week to move the Euro will be the Inflation data on Friday 31st August, we are expecting potentially some further good news on Inflation rising which is supportive of an interest rate hike in the future for the Eurozone. The ECB, European Central Bank, has laid down some foundations for an interest rate hike in the future, potentially the summer or end of 2019.

Clients with a Euro requirement buying or selling might find the Euro continues to trade strongly, particularly against the pound, there does appear a real chance the Euro will make further gains, the 2018 low of 1.075 does seem very much in focus.

For more information on the best rates and strategy buying or selling Euros with pounds, please do not hesitate to get in touch with me Jonathan Watson to discuss further. Please email me on jmw@currencies.co.uk to discuss further.

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

 

Jonathan Watson

Turkish debt concerns could cause trouble for the Euro (Daniel Johnson)

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GBP/EUR – At present there seems to be little hope for Sterling rising in value against the majority of major currencies. The main anchor for the pound is the fact that a Brexit “no deal” scenario is still on the cards, while this is still a possibility I think there is little hope for Sterling to gain significant ground.

There could however be the chance of Euro weakness. If the Turkey situation escalates this could well hit the Euro. There are several large European Banks who are owed substantial sums of money from loans to Turkish business. BBVA, BNP Paribas and Unicredit are among those owed.

The problem is due to the rapid fall in Turkish Lira and the ongoing strengthening of the US Dollar. The loans were predominantly taken out in US Dollar and now due to the currency differential the debts are now substantially more expensive.

Inflation is also rising rapidly and President Ergdogan has been extremely stubborn in regards to trying to counter the effects through a change in interest rates. A central bank is meant to act as a separate entity to the government, but with the appointment of Erdogan’s protege and son-in-law in charge of Turkey’s economy there seems little chance of any counter measures against inflation.

Qatar has just provided $15bn in financial aid which has eased the problem, but if the International Monetary Funds (IMF) needs to get involved this could send shock waves through the market and the Euro could lose value.

If you are sitting on Euros at present and are moving back to Sterling I would take advantage of current levels. I think there is potential for further gains for the Euro due to the lack of clarity surrounding Brexit, but looking at risk verses reward I would be taking advantage of current levels, we sit at a yearly high for Euro sellers.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker if you wish to maximise your return. If you let me know the details of your trade I will endeavour to produce a free, no obligation trading strategy for you. If you have a trade to perform I will also happily provide a free quote and I am confident our rates are among the best in the industry. I would be willing to demonstrate this in form of a comparison with any competitor. You can trade in safety knowing you are dealing with company FCA registered and one that has been trading for 16yrs. Foreign Currency Direct PLC.

If you would like my assistance I can be contacted at dcj@currencies.co.uk. Thank you for reading. Daniel Johnson

 

Daniel Johnson

Brexit still dictating Sterling value (Daniel Johnson)

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GBP/EUR – We have recently seen GBP/EUR rise to the 1.12s, however I believe this is more due to Euro weakness than Sterling strength. The ongoing trade war between the US and Turkey has the potential to escalate. With the US targeting steel with it’s tariffs and Turkey being a significant exporter it is hitting the Turkish economy hard. There is also a refusal to change monetary policy from Turkey which has the potential to cause further damage.

If the IMF are forced into a position where they need to provide Turkey financial assistance this will impact the Euro and investors are watching the situation with a keen eye. If it were not for the lack of clarity surrounding Brexit I would of expected a more significant gain for Sterling.

There have been unconfirmed reports that Brussels are willing to allow the UK access to the customs union and still have control of it’s borders. If this possibility becomes substantiated this will be very good news for the Pound and we could expect a Sterling rally.

At present however a “no deal” scenario is still a possibility and I expect the pound to be anchored at low levels until we have firm news and clarity on a Brexit deal.

If you have a currency requirement I will be happy to assist. If you let me know the details of your trade I will endeavor to produce a free trading strategy. During a period of such uncertainty it is important to be in touch with an experienced broker if you wish to maximize your return. We have tools at our disposal to make sure you do not miss out if there is a spike in your favour.

If you already have a currency provider in place. Drop me an email with what you are being offered and  I am very confident I will be able to demonstrate a significant saving. It will only take you two minutes and I am  sure it will be worth your while. You can trade in safety knowing you are with a Foreign Currency Direct PLC, a firm trading for over 16yrs and FCA registered.

If you would like my help feel free to email me at dcj@currencies.co.uk.

Thank you for reading.

Daniel Johnson

When will the Euro weaken?

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Euro strength seems likely to persist but cracks may easily emerge

A key question for any client looking to buy Euros is when will the Euro weaken? Troubling for any client buying Euros is economic might of the Eurozone economy which has been growing and really appears to have turned a major corner after many distressing years with concerns over debt.

With the US Federal Reserve and the Bank of England on course to be raising their interest rates further, and the European Central Bank, ECB currently stuck at negative rates, the prospect for a weaker Euro against these currencies seems a matter of when, not if. A further factor toweaken the Euro would also be the prospect of debt problems resurfacing. Italy and Greece are still majorly indebted which could easily trigger a loss of confidence in the single currency in the future.

When will Eurozone debt issues resurface?

This is a very difficult call, the market is a strange beast. Sometimes, it all comes down to perception and sentiments. With Mario Draghi, President of the ECB suggesting he will ‘do whatever it takes’ to save the Euro, there remains an important backstop to further future weakness. Nevertheless these issues could easily resurface at any time, Greece’s debt is still 180% of GDP, Italian debt is 132% of GDP. As a guide UK debt is 88% of GDP and German debt 61%. Italy also owes the ECB €500 bn as part of various loans, these are not small numbers!

At present the Euro is performing well against its counterparts compared to some historical levels. GBPEUR had spent most of 2000-2007 in the 1.40’s before the financial crisis took us to 1.03 for the beginning of 2009. The average thereafter has been just over 1.20 with lows of 1.16 rising to highs of 1.44 from 2013 to 2016.

The Euro is buoyant against most currencies presenting a very good historical time to be selling for another currency. There is not a huge amount of economic data this week from the Euro but some key UK and US releases which could impact GBPEUR levels.

If you need to buy or sell Euros and wish to discuss any strategy to maximise a deal further, please contact me Jonny on jmw@currencies.co.uk.

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

Jonathan Watson

Strong UK employment figures fail to hide Brexit concerns, where to next for GBP/EUR?

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The Pound is coming under increasing pressure at the moment, owing to both poor economic data and concerns surrounding the Brexit and how it’s unfolding.

Despite the UK jobs market being very healthy, and you would have to go back as far as the mid-1970’s to see a jobs market this healthy as the number of unemployed sits at just 4.2%, the Pound is still coming under pressure owing to other factors impacting its value.

This news has done little to boost sentiment surrounding the Pound as wage growth is coming under pressure, inflation is falling and the UK Prime Minister, Theresa May is struggling to push through her Brexit plan.

There is a clear split in the Brexit camp and last night, May narrowly escaped defeat in the House of Commons that many think would have led to a vote of no confidence. Should her position come under pressure I think we expect to see the Pound fall further, as it’s now late in the process and the UK is running out of time to agree the plan amongst its own government before even putting forward the plans to the EU.

Data is light for the remainder of the week, so I expect the GBP/EUR rate to be driven by Brexit related news and also whether or not the expected rate hike from the Bank of England in August.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Joseph W

Euro strengthens as migrant crisis agreement is made at EU Summit

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The Euro has strengthened across the board of major currency pairs today, as in the early hours of this morning an agreement has been made between EU leaders regarding the migrant crisis and how to best deal with the issue.

Talks continued for 10-hours and news of the agreement has pushed the Euro rate higher. The currency is trading at a 3-month high against the Pound making it a good time to convert Euros into Pounds.

The agreement ensures that ‘voluntary centers’ will be set up in Europe and these will be used to determine whether the refugee’s are genuine or not. The issue was a great matter of contention and has threatened to break up the EU with Italy threatening to veto the EU’s agreements if a reasonable solution wasn’t put forward. The Italian Prime Minister has since stated that ‘Italy no longer stands alone’ and the news is also good for Angela Merkel, the German Chancellor as there were concerns of a split in her camp regarding the matter.

Moving forward this topic is likely to continue influence the GBP/EUR rate, and today at the EU Summit Brexit is expected to be the main topic so there could be further updates from the Summit that influence exchange rates. If you would like to be kept updated in the event of a major move for the pair, do feel free to register your interest with me.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Joseph W