As I predicted in my last post, the European Central Bank have just announced further stimulus in the form of a cut to the benchmark interest rate to 0%, and have also expanded their Quantitative Easing programme. I said there may be a temporary spike in GBP/EUR rates as a result, and this is how the chart looks at the time of writing:
As you can see there has been a significant weakening of the Euro, pushing the rate above the key €1.30 mark to level at €1.3050. At 13:30pm today the ECB president Mario Draghi will give a press conference, and his comments in this may cause further volatility in the rate.
Personally I don't think these gains will hold. The initial market reaction will probably correct itself pretty quickly and I would not be surprised to see the rate back below the €1.30 mark by the end of the week, if not the end of the day.
What this does present however is an opportunity to buy Euros at the best rates we've seen in over a month. If you need to buy Euros at the best possible exchange rates and would like a quote, then click below to send me a free no obligation enquiry.
Click here to send an enquiry and get a quote
**** Update ****
Well that didn't last very long! As I thought, the spike was indeed very short lived, and in his press conference Mario Draghi has said that he doesn't think any further stimulus will now be necessary. The Euro has regained all it's losses, and some more, pushing rates down to €1.2820. It's already moving back up towards 1.29 however, and by the end of today, it's likely to be back to where we started the day at around €1.2950.
While in the grand scheme of things we're probably going to end up with the same exchange rate we started the day with, it's short term spikes in the market like we've seen today that can make a huge difference when exchanging currency, and my clients that were registered with me and ready to make a quick decision were able to take advantage, and trade at levels above €1.30.
Labels: Best Exchange Rates, Currency, ECB, EUR, FX Overview, GBP, Pound/Euro up