Tag Archives: exchange rate
Band of England Minutes released
Earlier today the Bank of England released their meeting minutes from 2 weeks ago. It confirmed the speculation that more members had voted for an interest rate hike in a cry to curbe inflation which is sitting twice as high as the government target. The concern stands that as commodaty prices raise along with fuel and food costs inflation will continue to climb.
The markest reacted possativly and the pound reached close to a 6 week where clients ready to trade securied their exchange. Now however the rates have falled back down as it was confirmed Andrew Sentence, one of the standing members that has been pushing for a raise, will be leaving the Monetry Policy Commette in the next few months. It affected the concesses of when the UK could raise rates.
If you are in a position ready to send money abroad and want to catch the peak, make sure you complete a comparision to make sure you achive the best price from the industry.
Buying Sterling Inflation report makes it more expensive
This afternoon the pound has weakened significantly against a basket a major currencies as we get closer to the UK inflation report tomorrow. This report given by the Bank of England (BOE) quarterly gives key information about inflation in the UK as well as their thoughts and predictions on what they expect Q4 GDP figures to show. Both of these are key to the forecast for sterling and therefore the strength of the pound effecting individuals and businesses looking at completing a money transfer in a short and medium timeframe.
Currently inflation stands at 3.1%, significantly higher than the government’s aim of 2%. Traditionally inflation is seen as a good thing for investors as it normally leads to interest rate hikes. In the UK with a recovery so dependent on a strong housing sector this in my option is out of the question, hence the BOE’s Quantitative Easing program earlier last year. In my option there is little more that the BOE can do to lower inflation, however if you are looking to sell pounds and buy for example euro’s this is exactly what you should be hoping for, an inflation figure lower than 3.1%.
With regards to GDP figures this is also key as it shows their thoughts on the overall health of the UK. Q4 figures are especially important as it equated for a large proportion of our overall GDP. This is because of Christmas shopping as the retail sector equates for nearly 60% of our GDP. Again people looking to sell pounds and buy a foreign currency should be hoping for a positive figure from the BOE as this will improve exchange rates and foreign currency forecast’s.
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