It's also the case that as we enter 2017, focus is going to shift back towards what is going to happen when article 50 is triggered. There are likely to be many rumours about what deals may or may not happen, and speculation about what the future relationship with the EU will look like. This is likely to drag on for many months, and will only increase the uncertainty surrounding the Pound.
Over the course of the last few months, GBP/EUR rose 10 cents hitting highs of €1.20, but it now looks like this pair has peaked and rates are dropping back away. In the face of continued Brexit uncertainty, it would be a brave person that gambles on exchange rates rising further.
Buying property overseas and need to convert GBP to EUR?
If you need to buy property overseas in the next 6 months, then it's wise to consider fixing the rate now with a 'Forward Contract'. This allows you to lock in the rate now for up to 2 years, but you only have to lodge 10% of the total to be converted. This is especially useful when budgeting for buying property overseas, as you will know exactly what the property is costing you and you are also protected against the rate dropping away. If you would like to discuss Forward Contracts in more detail or simply get a quick quote for your currency exchange, click here.
Converting Euros back to Pounds?
Those that are holding a foreign currency to convert back into Sterling are still in a favourable position given the weakness in the Pound. Despite the fact the rate has been moving against you recently, converting €300,000.00 today is still getting you nearly £30,000.00 more than before the EU referendum. The Pound may weaken further, however it's also important to note that there are some significant events next year such as elections in France and Germany, and the Italian banking crisis that threatens the worlds oldest bank. All of this could potentially weaken the Euro.
If you need to move Euros back, then consider taking advantage of the gains while they are here, rather than risk losing all the gains since the summer. If you do want to hold out to see what happens when article 50 is triggered, then consider a 'Stop Loss' order to cover yourself. This allows you to take advantage of any gains in the rate, while having a worst case scenario should the Euro weaken significantly. You simply instruct us to convert funds if the rate goes above a particular level, €1.24 for example.
"The secret of getting ahead, is getting started" ~ Mark Twain
If you need to convert any international currencies in the next 6 months, then you're about to experience one of the most volatile periods for the currency markets in a generation. Ultimately there is no way to know which way things will go next year, however what you can do is take advantage of our foreign exchange services to ensure that you get the best possible exchange rates.
We have a range of different contract types to suit various different needs, and the rates we offer are extremely competitive, and up to 3% or 4% better than your bank or existing broker may offer. Why not get in touch for a free quote and see how much you could save; on large transactions of £100k+ we often save our clients thousands of Pounds. We are fully FCA authorised so you can trade with us with complete peace of mind.
This will be my last post before Christmas, and would like to take the opportunity to thank my regular readers and clients for their support throughout 2016, and wish you all a very Merry Christmas and a happy and prosperous 2017. If you have yet to speak to us and would like to find out more about how we can help you with your currency requirements, Click here or complete the form below to make a free enquiry today .