Tag Archives: exchange rate

GBPEUR rates fall further towards a 2 month low (STEVE EAKINS)

GBPEUR rates were surprisingly steady yesterday with very little movement – especially following the large swings we saw at the end of the week. GBPEUR levels are still trading towards a 2 month low meaning it is an attractive time for euro sellers to move.  Comments from Mario Draghi last week showed that interest rates will remain low in Europe for the “foreseeable future” which helped weakened the euro at the time.  I know there is talk of concerns coming again from Greece and Portugal however it seems the market still remains confident in the Euro.  Meaning Euro buyers may not want to get too gluttonous holding out for a big spike.

My personal view is that GBPEUR will remain range bound between 1.155-1.165 within the next 7 days, 1.16-1.17 over the next fortnight but potentially fall when the Bank of England minutes are released in 10 days’ time.  

Euro buyers in the short term I would suggest potentially buying this afternoon following UK GDP figures if it pushes prices up, but certainly to move before the 18th with BOE minutes are released.  Euro sellers and pound buyers I would think to move before the release this afternoon or wait out till the BOE minutes if time allows.

Either way – the FX markets never move in a straight line, meaning there will be opportunities to get good prices if you watch markets constantly.  If however you are not in front of the markets for 10 hours a day and wish to achieve the best price you may wish to register for SPIKE notifications here via email at hse@currencies.co.uk

I’m confident we can provide you both with competitive exchange rates and information to help you make an informed decision as to when to make your transfer. If you have any queries or questions please do not hesitate to contact me.

Steve Eakins

hse@currencies.co.uk

 

Euro rates forecast – EURGBP at MONTH HIGH – Buying euros – Selling euros (Steve Eakins)

The euro has gained some strength recently both against the pound and the dollar.  The EURGBP trade is at its strongest that we have seen for over a month due to a number of reasons.  Firstly European news has been somewhat positive; market sentiment has seemed to have improved along with the power house of Europe; Germany, showing an improvement.  We have also seen green shoots coming from countries like Spain who has reported recently that their manufacturing figures are up close to a 2 year high.  This has all helped the euro strengthen, giving people with euros to sell a good opportunity to take advantage.

This coming week however things may change.  The busy day is Thursday when we have the interest rate decision for both the UK and Europe. In Europe there is an expectation that the overnight interest rate – which is the rate offered on deposits overnight by European based banks – may be cut.  This could be seen as negative which could take the wind out of the Euro.  Also in London the MPC is meeting now for the first time with the new head of the Bank in place.  This release on Thursday will tell us of any immediate change to UK banking policy.

As a result I would suggest clients with euros to sell to limit their exposure or take advantage of this current month high.  Here we have access to award winning exchange rates so make sure you get in contact for a quotation to see how much you could save.  Either email me directly at hse@currencies.co.uk with your details or contact me Steve Eakins via the normal number at the top of this page.

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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