Exchange rates forecast 2014 - a year in review

Monday 30th December 2013 
Welcome back, and I hope everyone had a lovely Christmas! Pound/Euro rates have fallen a little today, from €1.20 down to €1.1940 at the time of writing. 

For something a little different, in today’s post I am going to take a retrospective look at what has happened with key currency pairs throughout 2013, including Pound/Euro. I will explain what has happened with exchange rates and what caused them to move.

I will also take a view on what the exchange rate forecast is for 2014, so anyone with a currency requirement in the next 12 months should find this useful. 

Remember I don't just write about the markets - I am a senior currency broker for one of the UK's leading currency brokerages, and can help you achieve exchange rates up to 5% better than banks will offer you, potentially saving you thousands of Pounds. I have 8 years experience in the industry, so if you need to the best exchange rates, take advantage of my knowledge by getting in touch for a free chat about exchange rates.

So read on to see what the future holds for your exchange rate, and to find out more about the services I offer, send me a free enquiry by clicking here. 

Pound/Euro in 2013, and the forecast for 2014

It has been a year of mixed fortunes for Sterling/Euro rates, but as 2013 comes to a close rates remain close to the best they have been all year. 



We started the year very strongly with rates above €1.20. As the year progressed however, rates fell steadily for the first part of the year, dropping as low as 1.15. This was due to the UK’s ongoing Quantitative Easing programme, and concerns over how well the economy was growing. 

http://www.foreignexchangerateforecasts.blogspot.co.uk/2009/01/contact-us.htmlIn the summer the Pounds’ fortunes were reversed, and the UK economic recovery really took hold, and rates started to rise again. Part of the gains were due to the improving economy picture in the UK, including better growth figures and falling unemployment.

The other factor in the Pounds gains was when Mark Carney took over the helm of the Bank of England. When he did so, his ‘Forward Guidance’ approach and general positivity about UK growth gave investors’ confidence. As unemployment continues to fall, it’s likely that interest rates may start to rise in the UK, and that has also given the Pound strength helping rates rise.

So where will Pound/Euro go in 2014? Well if things continue to improve and unemployment keeps dropping, I think the Pound could break above €1.20 and get to the mid €1.25’s in 2014. This isn’t a given however, as if the exchange rate gets too high, we may well see the Bank of England move to devalue Sterling. They would do this as if the rate gets too high, it would make exports from the UK less attractive, so for this reason we might not see rates get much above €1.20.

If you need to buy or sell Euros in 2014, then contact me for a free consultation on your options, to make sure you make the most of your currency transaction.

Pound/US Dollar in 2013, and the forecast for 2014

It’s a similar story driven by the UK economy. Rates fell for the first part of the year, and then recovered and currently sit near the best in 2 years. Part of this is due to the same reasons I have outlined above with regards to the UK economy.



The other factor is that the US is now starting to wind up their Quantitative Easing programme. This has given investors more confidence in the Global economy, and so the US ‘safe haven’ Dollar has started to weaken, making it cheaper to buy.
http://www.foreignexchangerateforecasts.blogspot.co.uk/2009/01/contact-us.html
In 2014 this currency pair is hard to forecast due to its safe haven status. On the one hand, a recovering UK economy would mean rates rising. However as the US economy is also starting to improve, this could give strength to the Dollar and bring rates back down into the $1.50’s, which many forecasts I read are now suggesting.

So if you have Dollar requirements, buying or selling, in 2014, it’s important you know all your options and have a clear understanding of what may move the rate. Click here to get in touch with me to discuss your requirements and make sure you’re well placed to get the best possible rate.

Pound/Australian Dollar in 2013, and the forecast for 2014

This currency pair earlier in the year was at its lowest in decades, but in recent months has risen again and is currently sitting at its highest in nearly 4 years! So what has been going on?



Well the reason it was so low is due to China. Australia has a huge mining industry, and China buy lots of raw materials from Australia. This huge demand from China had caused the Aussie Dollar to become incredibly strong, and therefore expensive to buy – this is why rates were very low earlier in the year.
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However China’s economy is now growing at a much slower rate and this means less demand for Australian raw materials. As such, the AUD has weakened quite a bit, and helped along by the strengthening pound we now see the best rates for many years. 

The wildfires in the Country also harmed its agricultural industry, further weakening the currency. If you have an AUD requirement, click here to find out what I can offer.

Get in touch today to get the best exchange rates. 

http://www.foreignexchangerateforecasts.blogspot.co.uk/2009/01/contact-us.htmlI can trade most major international currencies, and the rates I can offer you can be up to 5% better than banks can offer. The savings can be considerable, so if you will have a requirement to buy or sell currency in 2014, get in touch with me to see how I can assist you.

In addition to better rates, I can talk over what is moving the exchange rate, and what factors may influence it in 2014. In this way you can make an informed decision on when to fix your rate, and of course by using my services, the rate you get when you decide to move ahead is much better than your bank will offer.

In 2013 I have helped hundreds of clients save tens of thousands of Pounds by getting better rates of exchange. It costs nothing to make an enquiry and get a quote to compare with your bank, so click below to find out more about my service.

Click here to send me a free no obligation enquiry.

I hope regular and new readers alike have found my posts useful, and I look forward to continuing providing an insight into exchange rates throughout 2014. I would also like to everyone a very happy and prosperous New Year.

Alastair Archbold