This week the GBP/EUR rate is expected to have a volatile time. The Bank of England Interest Rate Decision has been eagerly anticipated for weeks as the fallout from Brexit takes a toll. The big question has been around if there is enough evidence to prove the Brexit has begun to affect the economy.
Justification for a cut
There has been data released that indicated in the business world that there is a slowdown. The Purchasing Managers Index was at a 82 month low 2 weeks ago and could play a major factor in the decision. There hasn’t been any GDP or Inflation data released after the vote so a decision would have to be based on a predication or alternative facts. GDP and the Consumer Price Index were both up in their last readings so the cut may have to wait.
Alternatively there may not be an interest rate cut but the Bank could decide to introduce further Quantitative Easing. This would be in an attempt to encourage more banks to lend essentially stimulating the economy.
What will the cut mean?
The interest rate decision will cause major movements and there could be good windows for buyers and sellers. The rate has already started to fall this morning and I believe it’s not likely to get much stronger until a decision is made. Investors have started to relinquish their Sterling positions in the market which I believe is causing the GBP/EUR rate to drop down into the low 1.18’s.
If you are looking to complete a currency purchase in the next few days, making sure you’re in a position to trade could help you achieve the most savings.
I am a trader in a currency brokerage giving me access and control over rates of exchange that I can offer you. I am also able to assist with timing a transaction to make sure you get the most for your money. If you do have a currency requirements please feel free to send me Ben Fletcher an email at [email protected]