Todays UK Data
The only data of note for the UK today is monthly and annual retail sales figures. The retail Sales released by theOffice of National Statistics measures the total receipts of retail stores. Monthly percent changes reflect the rate of changes of such sales. Changes in Retail Sales are widely followed as an indicator of consumer spending. This can then have an effect on the value of the pound, and therfore can cause volatility in exchnage rates. Get in touch today to find out how this may affect exchange rates.
USA and Canada
We also have Consumer Price Index data for both Canada and the United States. This is a good indicator of inflation in the two countries, and often has a big impact on exchange rates. If you have a requirement to purchase either CAD or USD then contact us to find out what this may mean for exchange rates.
UK Repossessions
A sharp increase in the number of people having their homes repossessed last year is expected to be revealed by figures released later. Analysts predict the Council of Mortgage Lenders will say that 42,000 homeowners lost their properties in 2008, up from 26,200 in 2007.
The Ministry of Justice is also expected to report a rise in the number of repossession orders made by courts. In December the government unveiled extra help for struggling homeowners.
Announced by Prime Minister Gordon Brown, the Homeowner Mortgage Support Scheme is designed to allow households with mortgages of up to £400,000 to defer interest payments for up to two years if they suffer a sudden and temporary loss of income.
If the fugure is indeed high then it could well weaken Sterling further as it could be viewed as more bad news for the hard hit UK economy.
How can I protect myself?
If you are concerned about the falling value of the pound, and want to protect yourself against adverse exchange rate movements, then at the Foremost Currency Group we have various types of contract that we offer:
Spot Contract
The Spot Contract is the most basic and popular foreign exchange product. It is an agreement to buy or sell one currency in exchange for another. You have 2 days to settle the contract, at a price based on the prevailing "spot exchange rate" the current value of one currency compared to another.
Although the spot market lets you buy or sell currency as you need it, spot exchange rate movements are highly unpredictable, even during a single trading day. Upon receipt of cleared funds currency is available for onward transmission.
Forward Contract
A Forward Contract lets you buy or sell one currency against another, for settlement no later than on the day the contract expires. Unlike spot contracts, a forward contract eliminates the risk of fluctuating exchange rates by locking in a price today for a transaction that will take place in the future (up to a maximum of 2 years).
A 10% deposit is required to secure the contract and is payable within two working days with settlement due on the day the contract expires.
Option Dated Forward Contract
An Option Dated Forward Contract lets you control fluctuating exchange rates by setting a price today for a foreign exchange transaction at a future date. Unlike a regular forward contract, which requires you to complete the transaction on the day it expires, the Option-Dated Forward gives you the flexibility to take delivery of your currency in an agreed time period before the expiry date. This gives you all the advantages of a regular forward contract plus added flexibility of time.
A good example of where this type of contract may be used would be for clients purchasing property with time windows for payment ie. stage payments on a new build. A 10% deposit is required to secure the contract and is payable within two working days, with settlement due within the agreed time option or before the contract expires.
Limit Order
A Limit Order is an order to secure currency at a specific price that may not be currently available. This type of contract is particularly useful when the markets are moving in a positive direction for you. This is one of the two most common types of orders, the other being a Stop Loss Order.
Stop Loss Order
A Stop Loss Order is used when the market is moving in a negative direction for your currency. An order is placed on file with your broker to help ease the stress of adverse market movements. A stop loss order instructs your broker to buy when the currency hits a certain point. The purpose of the stop loss is obvious – you want to prevent any further movement before the currency falls any further.
To find out more about these types of contracts, Click Here to Send me an Email
If you are looking to make a transfer abroad, and would like to find out more about Foremost Currency Group, then simply click on the link below to visit our main site.
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Labels: EUR, Exchange Rate Forecast, GBP, Sterling Outlook, USD