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Showing posts from September, 2017

GBP/AUD close to a 4 month high

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As with the euro the pound has recently seen a consistently strong run against the Australian dollar having rallied in the region of 6% since the end of August. On a £200k money transfer this is
a difference of over 18,000 AUD

Much of the moves can be attributed to global market uncertainty, particularly surrounding the US and North Korea. 
Following the developments earlier in the week there has been a big risk off for higher yielding currencies, including the AUD, NZD and ZAR, 
Theses currencies can be heavily influenced by investor and market sentiment and will often perform poorly when investors and major financial institutions take stock and become more risk averse.
Heading into next week we may see further volatility for the Australian Dollar as Tuesday sees the latest interest rate meeting and accompanying monetary policy statement from the Reserve Bank of Australia. 
Recently the central bank has been fairly dovish and tight lipped surrounding any interest rate movement, shou…

Pound/Euro recovers to €1.14

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Will Pound/Euro go up or down?
Sterling has bounced back this afternoon, with GBP/EUR recovering from lows of €1.1350, back to where we started the day around the €1.14 mark, which is the highest in nearly 3 months. While Mark Carney did his usual job of talking Sterling down as we mentioned in this morning's earlier post.

Throughout the afternoon however the Pound recovered after the end of the latest round of Brexit negotiations. It seems some progress has been made and that was enough to push the Pound higher.

History repeated? 
As you can see from the chart below, back in June and July rates were also up at €1.14 but hit 'resistance' at these levels as was unable to break above this mark. It sat at around this level for some time, before dropping to €1.08.

For the last week this pattern seems to be repeating, with the rate unable to go much above this level.


There's no way to predict if we'll see a repeat of what happened a few months ago, but with a 6% gain in…

Sterling falls following Mark Carney's speech

Sterling's recent rally against the euro came to an abrupt halt this morning following Mark Carney and Theresa May's speech in which it was empathised that the performance of the UK economy will hinge on on-going Brexit negotiations. 
On the 20th anniversary since the Bank of England were given the right to set interest rates Theresa May was quoated as saying "the British people should never forget the vale of the free market". She was also quick to emhasise her determination to be tough on public spending.
Following the speech the pound took a tumble to fall from yesterday's high of 1.1433 to reach this mornings low of 1.1347.
To get more insight int our thoughts on the current market conditions or to speak to a specialist please click here or email mgv@fcgworld.co.uk

GBP/EUR continues postive move ahead of Mark Carney's speech tomorrow

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Sterling has continued its recent resurgence against the euro pushing through 1.14 and reaching a high of 1.1432, just shy of  4 month high. This comes ahead of a key speech from Bank of England governor Mark Carney who will be speaking tomorrow at 09:15.

In recent weeks the pound has gained momentum following hints from the central bank that they may consider raising interest rates, a move that some analysts feel could significantly damage the UK economy. 
Although the economy has so far managed to avoid any major downturn post the Brexit vote last June, households are coming under pressure from rising inflation due to the low value of the pound and hence the call from some to look at raising rates. 
During Carney's speech it is likely the topic of interest rates will be high on his agenda. Should he suggest it is unlikely that rates will rise in the short to medium term then the pounds recent run could come an abrupt halt.
Should you have an upcoming money transfer to arrange an…

Pound/Dollar drops from 15 month high

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Sterling/Euro rates remain at around the €1.14 level, the best we've seen in around 3 months.

Pound/Dollar rates however, have dropped away from the recent highs of $1.36 which was the best it had been since the EU referendum. Comments from the FED chair Janet Yellen last night strengthened the USD, making it more expensive and pulling GBP/USD down to $1.34.

She said that they need to be careful not to raise rates "too gradually", which markets have taken as a sign that there will almost certainly be another rate hike this year in the USA.

(A currency usually strengthens on rumours of interest rates going up, due to the higher return on offer for investors, which in turn increases demand.)

It's still a pretty good level for those that need to buy Dollars, and with it looking more and more likely that interest rates in the USA will go up again this year, rates could fall further.

Most of the GBP/USD trades that we do for clients are for businesses that import their goo…

GBP/EUR hits €1.14 - could it rise further?

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GBP/EUR rates broke through €1.14 earlier today, but have been unable to hold on to the gains. The market hit resistance at that level and has not managed to rise any further.

Given the 6% gain for Pound/Euro this months it's not a great surprise that the Pound's bullish run seems to have come to an end.

It's certainly a good time to considering fixing a rate on Euros. Converting £250k to EUR today compared to the start of the month is netting an extra €16,000.00 due to the rise in the value of the Pound.

We offer 'Forward Contracts' that allow you reserve the rate for up to 2 years, by lodging 10% of what you need to convert. This is very useful if purchasing property overseas and you want to avoid the risk of rates dropping back away. To discuss this in more detail, or to get a free quote, click here.

What could move exchange rates for the rest of the week?
Sterling - We have a speech by Mark Carney on Thursday, and when he speaks the Pound usually falls. On Fri…

GBP/EUR at a 2 1/2 month high

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Sterling exchange rates this morning have pushed to a near 2 1/2 month high against the euro. Since the end of August the pound has now rallied just shy of 6% against the single currency bringing about some much better opportunities for those looking to buy the euro.

Much of the moves seem to be attributed to weakened market sentiment for the euro following Sunday's election in Germany, although Merkel is set for her fourth term in office she now faces months of talks to try and form a coalition government. 
She has also vowed to try and win back voters that deserted her party for the right wing nationalist party AfD.

Should you have any future money transfers to arrange and need assistance with your transfer then please get in touch. With over 10 years of experience in the foreign exchange markets we are well positioned to help you make an informed decision regarding your future currency needs. For more information click here or email me direct mgv@fcgworld.co.uk

Strong day for the pound against the NZD and ZAR

Sterling has had a strong day against a basket of major currencies with notable moves having been seen against the Euro (EUR) with the pound up 0.8% against the single currency. Strong moves have also been seen against the New Zealand Dollar (NZD) with sterling up 0.85% on the day and now just two cents from a four month high.

Historically one of the most volatile currencies in the market is the South African Rand (ZAR) and again the pound has seen some success against the ZAR today. We have seen a range today from high/low of 17.86 to 18.01 a difference of over 1% - something very common for this pairing. The Rand is possibly the most difficult currency to forecast with political events within South Africa often dominating trends. To get more insight into our thoughts and the various services we can provide to assist you with your currency requirements please click hereor email mgv@fcgworld.co.uk

Politics drive GBP/EUR and GBP/NZD

Pound/Euro rises to around €1.14
GBPEUR rates have recovered a little back to around the best it's been in 2 months. On Friday, Theresa May's speech knocked the Pound a little. The markets seemed to like the proposed 2 year transition period, but the fact she repeated that no deal would be better than a bad deal dented appetite for the Pound sending it lower on the day.

The German elections over the weekend however have helped to weaken the Euro pushing rates back up. Merkel won about a 3rd of the votes which will leave her scrabbling to form a coalition, and this uncertainty has weakened the Euro a little.

Today we have speeches by ECB members that could move GBP/EUR and of course any further Brexit developments could affect the value of the Pound. Later this week UK GDP figures and speeches by the BoE governor mark Carney are also likely to be a driver for Sterling exchange rates this week.

GBP/NZD rises after Kiwi elections resulted in a hung parliament. So again a coaliti…

How could Theresa May's speech affect the Pound?

Sterling/Euro rates have fallen back away from last weeks 2 month high of around €1.14. The BoE governor gave a speech and he was typically gloomy about the effects of Brexit on the economy, stating that any interest rate hikes that may come would be small and gradual. This took the wind out of the sails of the Pound and it dropped back away against other currencies.

Retail Sales pushed Pound back up
This morning, the latest UK Retail Sales figures were released. The figures showed sales rose by 1% on the month, against an expected 0.2% rise. The Annual figures were also much better than expected showing that consumers are still spending, and this has pushed GBP/EUR rates back above €1.13 again. With much coming this week that could push the Pound lower, those that want to fix a rate now while things are close to a 2 month high can click here to get a free quote.

Important end to the week for Pound/Euro rates
Tomorrow (Thursday) we have the latest UK mortgage approvals and Public Se…

Pound/Euro hits 8 week high of €1.1360

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Sterling has strengthened further this morning, after one of the Bank of England members said in a speech that a rate hike would be needed soon, confirming what the MPC said yesterday.

What is interesting is that this particular member, Gertjan Vliegh, is considered to be a 'dove' which means he has been pushing for rates to stay on hold. The fact that more MPC members are now leaning towards an interest rate hike has helped the Pound.

(You can view live currency graphs here.)

Currency markets move more on rumour than fact, so an interest rate hike is now being priced into the value of Sterling and that's why the Pound has risen so much. The graph below shows how Pound/Euro rates have risen over the last few weeks:



Pound/Dollar rates are now sitting at $1.35+ which is back to the level it was at just after the EU Referendum last June. Again Sterling strength is much of the reason for the gain. GBPUSD has risen higher than GBPEUR because the USD is also weak helping to make …

GBP/EUR rises above €1.12 after Bank of England meeting

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The Pound has gained again today after the
Bank of England meeting. Only 2 members voted for a rate hike meaning rates have been left on hold at 0.25%. However, they gave hints and were much stronger in their talk of a rate increase, stating that it's likely to happen in the coming months.

They said there was a stronger picture of a firmer housing market, retail sales and car sales. Also with inflation running at nearly 3%, it's looking quite likely rates will now rise before the end of the year.

The reaction in the currency markets has been the Pound rising by over a cent against the Euro, with the chart below showing the big jump the moment the news came:


The Pound has now risen 4% in the last few weeks from lows of €1.0760 to where we are now, so a very welcome development for clients that need to buy Euros to purchase property in the Eurozone. We offer exceptional rates of exchange that are very close to the published mid-market level. If you have an upcoming transfer to …

Pound falls on wage growth numbers

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After rising to a high of €1.1130 this morning, GBP/EUR rates slipped back by half a cent, following the latest UK jobs data. While unemployment and jobless numbers were better than expected, wage growth was lower than forecast at 2.1%. This is important, as it will have a big impact on when the Bank of England will raise interest rates, and the prospect of higher rates will push Sterling higher.

Yesterday's inflation numbers on their own, would probably lead to the BoE raising rates soon and boosting the Pound in the process. However, with wage growth lagging behind inflation, it's likely that they will continue holding off until the 2 figures are more in line, so that actual real income is growing. That's why when this morning's figures came in at 2.1% the Pound fell by about half a cent (inflation is at 2.9%).

We also had EU employment figures coming in a little higher than markets had expected, giving the single currency a small lift.

All eyes will now be on the Ba…

Pound/Euro rises to €1.11 due to rising inflation

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This morning UK Inflation numbers were released showing a number of 2.7% against a forecast of 2.5%. The higher number increases the chance of the Bank of England raising interest rates this year.

While they are unlikely to do so this week, I think several members of the MPC will now be voting to do so.

GBP/EUR rates have now risen 3% in the last week, as you can see from the chart below:



If you need to convert Pounds to Euros, this is a welcome development. Converting £200k to Euros is netting you €7000.00 more than a few weeks ago. If you are looking to make a transfer and want to take advantage of these gains, then get in touch for a free quote. 

What else could affect Sterling exchange rates this week?
On Wednesday, the UK releases it's latest Employment and Earnings data. The Average earnings numbers will be the most important for the Pound, as if these continue to rise closer to the inflation number, then it's more likely UK interest rates will rise, which may help the …

What could affect Pound/Euro rates this week?

Pound/Euro rates rose slightly at the end of last week, after the European Central Bank hinted that they might not look to taper their stimulus measures until the end of the year. This helped weaken the Euro and push GBP/EUR rates back up to around the €1.09 mark. Pound/Dollar rates also rose due to poor US jobs numbers, weakening the USD and making it cheaper to buy.

Both major currency pairs rose, but as I've explained above, it's due to weakness in the EUR and USD rather than any strength in Sterling. In today's post, we'll have a look at what could move rates this week.

We're set for quite an important week that could give Pound/Euro rates direction. On Thursday, we have the ECB rate decision and there may well be hints that the ECB could end its stimulus programme. If so, expect the Euro to gain pushing GBP/EUR lower. On Friday, there is a raft of UK data too that could push the Pound higher or lower if the numbers differ from the expected.

If you need to mak…