Tag Archives: exchange rates
Euro rates rally against the Pound. Bank of England minutes tomorrow may cause further GBP/EUR volatility
Following a dip in the UK’s inflation rate the pound has fallen against a host of currencies including the Euro dropping rates into the mid 1.17s. With the Bank of England minutes released at 09:30 tomorrow morning tomorrow could also prove a busy day for GBP/EUR. For me I am not expecting to much from the minutes and indeed you may find very little impact on the market. In fact I feel the Bank of England may adopt a relatively neutral stance over the next 6 weeks as Sir Mervyn King hands over the reigns to Mark Carney in July. It is at this point that you may find more radical policies to be implemented by the central bank. Many expect Mr Carney to impose of self from the word go and give a nod to further Quantitative Easing, or even a surprise interest rate hike – of course he does not have the final say and will need to see a majority vote from the 9 members of the MPC (Monetary Policy Committee) but he may begin to influence his peers.
Also at 09:30 tomorrow watch out for Retail Sales figures from the UK (expected to show a strong improvement that could lead to GBP strength as a result). Should you have an interest in Euro exchange rates then also watch out for a speech from Mario Draghi Thursday morning, positive sentiment from Mr Draghi the Euro may continue its strong start to the trading week.
As you can see we have plenty of data released for the rest of the week. To be kept up to date with the impact these data sets may have for your individual requirement then please contact me and I will happily run though my forecasts and run through the various contracts we can offer to help maximise your currency exchange. I am very confident I can help achieve a better rate than your current provider. Please call the office on 01494 787478 or email me (Mike) with a brief overview of your requirement and I will gladly contact you to help with your money exchange. I can be reached at mgv@currencies.co.uk
Busy day for GBP/EUR, what data might influence exchange rates today?
Today we have plenty of data to keep those of you with an interest in Sterling and the Euro busy. This begins at 09:30 this morning with UK Industrial Production and manufacturing data. Both are expected to show a slight improvement month on month and should they come out as expected, or better, then this morning could be a strong start for the pound. Of course any deviation from the forecasted result and watch for market movement at 09:30. Following this at 15:00 watch out for UK revised GDP estimates. Currently the UK is on course for its third recession in five years and this data will give further clues as to whether or not this can be avoided. Expectations are for a figure of -0.1% and if as predicted will show the UK is still on course for the triple dip but is very also very close to avoiding recession. For me this will begin to take focus for the GBP/EUR pair in the next couple of weeks, as the markets moves away from the ongoing Cyprus debacle, eyes will be focused on the UK.
Of course there is a real threat of contagion resulting from Cyprus and this should halt any short term momentum for the Euro across the board, however I feel should the UK head back into recession I would expect to see GBP/EUR to fall back towards 1.15 territory. By avoiding the triple dip then I believe the 1.20 area will be tested. This leaves a large range for this pairing and my bring opportunities for both buyers and sellers in the coming weeks.
To discuss the market trends and current data that might affect your particular currency transfer then please contact the office on 01494 725353. As one of the UK’s longest standing independent brokers I am very confident I can undercut any price you have been offered. Should you wish to test the service or discuss the contracts we have available then please email me with a brief description of your current trade and I will happily provide you with a live quote. I can be reached by email on mgv@currencies.co.uk
Market a little calmer following Draghi’s press conference
Market conditions for the Euro have settled a little this morning following an extremely volatile day yesterday. Euro exchange rates fluctuated over a cent against the pound and the US dollar following the release of the European Central Banks latest interest rate decision and subsequent press conference held by Mario Draghi. Once again Mr Draghi proved ever the optimist, certainly far more optimistic than his UK counterpart Mervyn King. In his press conference analysts were looking for insight as to future monetary policy and whether Draghi would hint at the potential for interest rate cuts. Instead Draghi played down fears over the Italian election and highlighted there were little signs of contagion spreading across the euro zone with little rhetoric towards interest rate cuts as many expected.
This is a typical act of defiance from Draghi and has lent support to the Euro. This trend may well continue short term however I am a firm believer that the issues and fundamental problems within Europe will rear their ugly head once again. For me many people seem to have brushed these issues under the carpet and are focusing on problems elsewhere and predominantly focusing in on the UK. For me the next month will be very key to short term moves for GBP/EUR and the pound. Should the UK avoid the triple dip recession this could be initial shot in the arm required and we could see sterling recover. I am still confident 1.20 will return at some point this year and EUR/USD will head towards 1.25. For this reason anyone selling Euros at the moment should take stock, with gains of nearly 8% against sterling since the start of the year these returns have to be viewed as positive and there to take advantage of.
With so much market volatility it is important to be in a position to take advantage should we see an unexpected spike. By speaking with an experienced regulated currency brokerage this enables you to take more control over your exchange, certainly when compared to the high street banks. To discuss the current market trends in more detail and to find out how the service works and how we can benefit you please call the office on 01494 787478 or email Mike at mgv@currencies.co.uk
UK Construction Data Lower than Expected (Tom Holian)
Data published this morning shows that the UK Construction sector has had its worst month since October 2009. The PMI data out confirmed that the figure fell to 46.8 compared to 48.7 the previous month and anything below 50 represents contraction. This saw Sterling fall marginally this morning but as the data was close to expectation we haven’t seen too much impact for Sterling Euro exchange rates. One positive bit of information was that there was a small increase in residential activity. With the UK Budget due on 20th March all eyes will be on the Chancellor to see what changes will be made to promote growth.
EURUSD has challenged resistance levels today hitting 1.30 and staying in a tight range for most of the morning. Later this afternoon Jerome Powell from the FOMC will be talking and this could see Dollar movement this afternoon so rates for USD buyers could drop if the sentiment is positive. With GBPUSD exchange rates getting close to the lowest level seen since summer 2010 this is also having a direct impact on EURUSD which is trading at similar levels to November 2012.
There are fears that Cyprus will need another bailout which has seen the Euro lose a bit of strength this morning. There are preliminary discussions due to take place soon but the figures are very small so unlikely to have too much of an impact on exchange rates.
Data to watch out for this week
Tuesday- EUR Retail Sales due 10am
Wednesday 945am Mervyn King’s speech
Wednesday-EUR GDP Figures 10am
Thursday-Interest rates decisions for both UK and EUR
For up to date information as to how these data release will affect exchange rates feel free to contact me directly for a free quotation Tom Holian teh@currencies.co.uk
Sending Money to France? (Tom Holian)
Sending money to France? When sending money to France for a property you will more than likely have to transfer funds directly to your Notaire. Typically this is based on 10% for the initial contract signing and the further balance payable 8-12 weeks later. One issue you will have during this period is the exchange rate fluctuation which in a three month period can be quite large. Indeed, since the turn of 2013 GBPEUR exchange rates have dropped by 7% meaning a property at the beginning of the year that was valued at €200,000 is now the equivalent of £11,000 more expensive.
How can a currency broker help you?
By utilizing the service of a specialist foreign exchange broker you can secure your exchange rates from early on so that you know exactly what you’re paying for in Sterling even if the market goes against you. In order to secure an exchange rate for a period of time in the future you can place a deposit based on 10% on the Sterling value and the remaining balance payable on or before maturity date of the contract. One potential negative risk is that by locking into a rate you can benefit if the rate goes up. However, for many peace of mind is worth more and it means that the dream of buying a property abroad does not become a nightmare.
A specialist company can also help you protect you from adverse market movements by using Stop Loss & Limit Order which allow you to choose two exchange rates-both a higher and lower level which means you can budget for both best and worst case scenario. For more information as to how to save money when transferring Euros please contact me directly Tom Holian teh@currencies.co.uk
When is the best time to sell Euros?
The Euro has come under a little pressure and we have seen profit taking and a realigining of rates following last weeks huge moves. What can we expect this week?
Well the all important event is Thursday’s Interest Rate Meeting between the ECB (European Central Bank) and the BoE (Bank of England). No actual change in economic policy is predicted but it is likely we will see Euro strength. I would expect this to happen because despite the Spanish recesssion being deeper than thought and underlying Eurozone fears confidence is very high in Europe. Spanish and Italian bonds are proving highly attractive investments as are European stockmarkets. The knock on effect is more people buying Euros and their price increasing.
Is the Euro too strong? Well after such a big move we are bound to see some kind of correction soon. Argualbly we have already see this today with GBPEUR up over 1.16 and EURUSD back below 1.36. Such unprecedented movements highlight the importance of making careful preparations for your currency purchase well ahead of schedule. Today I have many clients who have been greedy and held on throughout the last few weeks when rates were above 1.20. They refused to buy at a rate lower than 1.25 because they held a belief that it would go back there. Complacency is a very dangerous thing and I have had the sad news of some clients buying property overseas having to cancel their purchase due to exchange rate movements.
When should I trade this week? The first thing to do is make sure you are ready to trade. Hanging around watching the rate tick up and down will not get you anywhere. Getting all your ducks in a row and planning ahead could potentially save you thousands. As a specialist currency broker we are assisting clients who need to make currency transfers understand the processes involved as well ensure they get the best deals and information on when to trade. For a quick run through of your situation feel free to contact me directly on jmw@currencies.co.uk
Aside from Thrusday which I think will be the most important day, tomorrow we have some UK services data and then Manufacturing and Industrial Production data for the UK due Thursday. All in all it is a fairly quiet week on the data front but this is a good time to assess your position. Euro buyers crying into their milk Friday were pleasantly surprised to be gaining an extra €1230 today on a £100,000 purchase. This is just a brief respite however as Euro sellers are without doubt though the main winners this year, at high to low if you are selling Euros you are gaining an exta £6000 for every €100,000 sold!
It looks like the rate will remain volatile presenting both opportunities for buyers and sellers - to stick my neck on the line and on balance I think it will probably drop further towards the end of the week as Mario and the ECB talk up the situation. If you are holding on buying Euros it would be sensible to start making a contingency plan as 1.20 looks a very long way off. For a free, no obligation discussion of your transfer and to be kept up to speed with all the important news please feel free to contact me Jonny directly on jmw@currencies.co.uk or of course call 01494 787 478. I am wholly confident I can undercut your current deal and can offer specialist assistance on when to make your trade. Last week I saved a client using one of our competitors £750 and you could be next.
I look forward to hearing from you.
Euro reaches 14 month high against GBP and US dollar. Has the Euro reached its peak?
Euro exchange rate have continued their recent assault on the currency market bringing levels against the Pound and US dollar to 14 month highs. Will this continue?
To me it is all a little surprising how far the Euro has moved, sure if you look at the fundamentals behind the UK and our European counterparts, yes the data has been poor from the UK but surely we are still in a better position than Europe? One could argue that Mervyn King (head of the Bank of England) its getting his way as he has been open in calling for a weaker pound to improve the UK’s exports, he is also notorious for talking down the UK’s chances of short term recovery whereas Mr Draghi (his counterpart at the European Central Bank) is often far more bullish when it comes to European finances. For me this is somewhat of a facade and I for one feel this pair is due a correction heading back towards the 1.20 territory. Should you be selling Euros, for this reason, and whilst levels are not far from a 14 month high, it may well be worth considering your options – this may include the use of a forward contract allowing you to guarantee your position even if you do not have full availability of your funds.
As for EUR/USD I think this too will see a correction short term moving back towards 1.33. The dollar then may well come under further pressure when the US debt ceiling deadline draws near come April.
If you would like updates on the market, register your interest by emailing me with your particular currency requirements (contact details, currency pair, volume and time frames). I would be happy to run through my current forecasts and to provide you with a quote for your upcoming exchange. I can be reached at mgv@currencies.co.uk
