Showing posts from June, 2012

Sterling/Euro exchange rate forecast July 2012

Friday 29th June 2012
Good morning. Sterling/Euro exchange rates have had a very strong week indeed, remaining supported around the €1.25 level. This is despite further poor data about the UK economy. The reason rates are good is because of the weakness in the Euro. Against other currencies Sterling has fallen this week. I think there is a very high chance that we will see more Quantitative Easing next week, and so I personally think these levels will not last for long. In today’s post I will look at what is weakening the Euro, and why Pound/Euro rates may fall back in July.

UK economic figures disappoint, but Sterling remains strong

We have had some further disappointing figures from the UK this week. Firstly the latest mortgage approval numbers were much worse than expected, pushing Sterling lower against currencies other than the Euro.

Yesterday the latest GDP figures were released, showing that the UK economy shrank by 0.4% in the final three months of 2011, compared with previous est…

Weekly GBP/EUR & GBP/USD and the weeks data

Monday 25th June 2012
Good morning. As always for Mondays today I'll have a look back at last weeks events, what moved the market and the Pound Sterling Forecast for future exchange rate movements. Also I will outline the most important data releases of the week that could affect rates. In this week’s Report:
More UK Quantitative Easing on the cardsSpain could be next to seek bailoutGreece forms government, calming exit fearsRound up of the week’s other data that may affect rates(For currencies other than GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

It was a pretty quiet week on the rate front for GBP/EUR last week however the news and data released could have caused it to be much more volatile.

Greek Election Result

Firstly the Greek election results seemed Euro friendly as the New Democracy party was voted in with a slight majority over the anti-austerity Syriza party (without gaining enough seats to become THE majority party), as it reduced the likelihood that…

Sterling Euro Forecast 2012; could rates be about to fall?

Thursday 21st June 2012
Good morning. Exchange rates have continued to be quite volatile, with news from the EU and Bank of England key to the future movements of the Pound Sterling to Euro exchange rate forecast. In today’s post, I will look at the following:
More UK Quantitative Easing (QE) on the cardsGreece makes deal to form governmentSpain and Italy to seek bailoutsWhat all this means for exchange rates
More QE on the way from the Bank of England

Yesterday the Bank of England (BoE) released the minutes to their latest decision to hold off further Quantitative Easing (QE).

They showed that the BoE's Monetary Policy Committee voted 5-4 against restarting the gilt purchases they suspended in June, with Mervyn King , Adam Posen and David Miles all voting for a £50 bn injection. What exatly is QE? There is an excellent article explaining it here on the BBC.

So it seems it was a very narrow call indeed earlier this month not to pursue more QE. The closeness of the vote suggest to me th…

How does Greek election affect exchange rates

Monday 18th June 2012
Good morning. Today's post is a little later than usual, as I wanted to wait until the markets had opened this morning to gauage the reaction to the Greek elections, and the effect it is having on exchange rates. So what do we have in this week’s Report?
Greek election result reduces chances of Euro ExitBank of England warn on more stimulusElsewhere in EU Spain/Italy could seek bailoutRound up of the week’s other data that may affect rates(For currencies other than GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

Yesterday saw the results of the Greek election as we saw a close victory for Antonis Samaras and the New Democracy party with 29.6% of the vote. The party has now been given three days to come up with and build a coalition government ready to tackle the on-going debt crisis, something that couldn’t be done just six weeks ago in the first election.

After inconclusive elections in May, world leaders have welcomed the narrow election vict…

Pound falls sharply on news of more BoE Stimulus

Friday 15th June 2012
Good morning everybody. Why has the Pound fallen against the Euro this morning? Things can change very quickly in the currency markets, and in my last post GBP/EUR rates were getting close to €1.25. The facts have now changed, and so has the exchange rate; the Pound has fallen sharply this morning, after The Bank of England announced yesterday evening that it will launch two new stimulus packages in response to the worsening economic outlook:

Sterling falls sharply on news BoE to pursue more stimulus

When the markets opened at 8am this morning the reaction was severe, and Sterling has dropped sharply across the board, as the chart above shows.

In the new developments, it was announced that together with the government, it will provide billions of pounds of cheap credit to banks to lend to companies. Banks will also have access to short-term money to deal with "exceptional market stresses". The chancellor said the measures would "inject confidence"…

EU Debt crisis & Pound/Euro forecast

Wednesday 13th June 2012
Good morning everybody. We started the week down in the €1.22’s against the Euro, which was supported by news of Spain’s Bank bailout over the weekend. It was hailed as great news for the Euro, and initially the single currency seemed supported. The spin did not last long however, and soon after markets opened the Euro started to weaken again. By yesterday fears that the crisis that has spread from Greece to Spain is now on the way to Italy and Ireland – this caused the Euro to weaken yet again, pushing rates higher.

In today’s post I’ll have a detailed look at the EU problems, the UK’s exposure to them, and what it all means for the Pound/Euro exchange rate forecast.

EU worries push Pound/Euro close to €1.25

Over the weekend it was announced that Spain became the fourth country in the crisis-torn Eurozone to ask for international aid when it was forced to ask for a bailout to prop up a banking system saddled with £150billion of toxic property loans.

The financial …

Weekly GBP/EUR forecast, and the weeks data

Monday 11th June 2012
Good morning. So another Monday morning and a fresh week to look forward to. Today I will take a look back at the reasons why the GBP/EUR exchange rates are being pulled in both directions due to the continuing crisis in Europe, and the possibility of more QE in the UK. In addition we will look at what measures you can take to protect against adverse exchange rate movements.

In this week’s Report:
BoE hold off more QE, for now at leastEU markets get the jitters over SpainGlobal Economic turmoil continues to drive ratesRound up of the week’s other data that may affect rates(For currencies other than GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

The BOE left interest rates on hold at the record low of 0.5% again this month and despite speculation, resisted pumping more money into the quantitative easing program which helped support the pound on Thursday. However the minutes from this meeting out later in the month will state how the members vot…

Bank of England decide not to pursue QE, for now..

Friday 7th June 2012
Good morning. The markets remain very volatile with the Pound/Euro rate continuing to be pulled in two directions. Only yesterday we saw lows in the €1.22's and highs touching €1.24's, illustrating just how unpredictable things are at the moment. So today I'll take a look at what is pulling the rate; Fears of Spain having debt trouble, and when the Bank of England are likely to pursue Quantitative Easing.

The Bank of England and Quantitative Easing

Yesterday the Bank of England left it's interest rates at 0.5%, and left quantitative easing unchanged at £325bn despite mounting speculation that it would take steps to stimulate growth this month. Before the decision, it looked like around 25% of analysts thought they would pursue more stimulus, and so this was partly priced into the value of the Pound.

When they announced no change for the moment, the Pound then corrected to the upside. If you look at the chart, you can see the instant reaction at 12:00pm…

Sterling/Euro & Pound/Dollar forecast outlook

Saturday 2nd June 2012
Good morning. For a change today's post comes to you on a Saturday morning - I thought given the long 4 day break in the UK, I would post the latest currency news for the next 4 days. UK markets will re-open on Wednesday morning, and blog posts will resume then. Today I will do my usual analysis of where rates have moved in the last week, and the forecast for future exchange rate movements.

In today's Report:
Pound/Euro falls back on poor UK dataPound/Dollar tumbles 10 points in a monthEU debt crisis continues to spook marketsRound up of the week’s other data that may affect rates(For currencies other than GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

Last week we have again seen a similar fluctuation in the GBP/EUR cross to previous weeks, with the rates moving close to the recent 3 and a half year high near the mid 1.25’s, before dropping down to the high 1.23’s later on in the week. This has been as a result of some important activity…