Sterling strengthens after Budget Statement

Wednesday 30th November 2011
Good morning. The Budget statement yesterday reinforced Sterling as a safe haven currency within Europe, pushing exchange rates higher against other currencies, and to a near 9 month high against the Euro as the EU debt crisis deepens. So why has the Pound risen against the Euro? Today we'll take a look at what strengthened the Pound and the forecast for GBP/EUR rates. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1710
• GBP/USD 1.5535
• GBP/AUD 1.5598
• GBP/NZD 2.0492
• GBP/CHF 1.4355
• GBP/CAD 1.6076
• GBP/ZAR 13.073
• GBP/JPY 121.04
• GBP/DKK 8.7067
• GBP/NOK 9.1185
• EUR/USD 1.3265

UK Budget Statement strengthens Sterling

Chancellor George Osborne yesterday updated MPs on the state of the economy and the government's future plans in his Autumn Statement as the Office for Budget Responsibility (OBR) publishes its latest growth and borrowing forecasts. You can read a detailed report on what happened here on the BBC site, as here we will only focus on the effect on exchanger rates.

Despite most news outlets pitching the statement as doom and gloom amid revised growth forecasts for the UK, the markets have taken it positively as reflected in the Pound rising yesterday. He said slower than expected growth meant it would take longer to reduce the budget deficit, meaning tough austerity measures will extend beyond the next election in 2015.

That is likely to underpin the UKs AAA credit rating and encourage more flows into safe-haven UK gilts. That in turn has supported Sterling despite the prospect of more QE by the BoE and the risk of recession. Analysts say the fact the UK is following an austerity plan and the BOE is proactive in easing monetary policy is a positive for sterling in the coming months.

In contrast, the euro zone debt crisis keeps getting worse with little policy action to stop the contagion. The debt crisis continues to deepen in the EU, and this has weakened the Euro further yesterday, pushing GBP/EUR rates back above €1.17.

There remains no fundamental reason to buy the pound, however amid the problems in Europe it has become a safe haven currency for savers worries about keeping Euros, and this has supported Sterling and is the reason exchange rates have risen.

So if you need to buy Euros in the next 6 months, what are the options?

• Buy Forward now – this way you know where you are, but of course can’t take advantage if the rate does get higher.

• Wait and see – it could go a little higher, but not by a huge amount. The risk here of course is rates falling away.

• Use Stop Loss/Limit Orders – with these, you can place a ‘Limit order’ to buy at a level that’s not currently available, 1.18 for example. At the same time you can place a ‘Stop Loss’ order to buy should rates fall below a pre-agreed level, for example 1.15. This way you have a ‘worst case scenario’ should rates fall, but if they don’t you can still take advantage of any gains

• Hedge your bets – Forward buy half what you need now, and take a gamble on the other half. This way you have some level of protection regardless what happens with rates.

To discuss any of the above options further, or to find out more about how much you can save by using us to secure your currency at commercial exchange rates:

Click here to send us an enquiry and have a free consultation on your options.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

UK Budget statement today

Tuesday 29th November 2011
Good morning. The Pound rose slightly against the USD yesterday, but remained range-bound against the Euro as comments from Bank of England policymakers that more asset purchases may be needed to boost UK economic growth helped to curb some of sterling's gains. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1630
• GBP/USD 1.5514
• GBP/AUD 1.5594
• GBP/NZD 2.0508
• GBP/CHF 1.4305
• GBP/CAD 1.6034
• GBP/ZAR 12.923
• GBP/JPY 120.86
• GBP/DKK 8.6499
• GBP/NOK 9.1344
• EUR/USD 1.3336

UK Budget Statement today

Chancellor George Osborne will today outline plans to boost the UK's slow economy. This is against expected gloomy forecasts for growth, after the OECD warned yesterday that the UK was likely to slip back into recession.

They predicted a 0.03% contraction in the UK economy this quarter, and a further 0.15% the next. Bank of England governor Sir Mervyn King told MPs that growth would be flat for the next six months as the eurozone crisis threatens the UK's recovery. This has kept Sterling in check against other currencies and has limited gains in exchange rates.

In his statement later he is expected to confirm that growth will be lower and borrowing much higher than planned. Many analysts have also warned that a nationwide strike of public sector workers scheduled for tomorrow may also sour sentiment for UK assets among foreign investors if they call into question the future success of dramatic austerity measures.

There is much negativity at the moment that could hurt the Pound, despite the EU debt crisis also weakening the Euro. Without the problems in Euro exchange rates would be significantly lower, so if you need to buy Euros consider taking advantage of the current rates, as negative sentiment today could lower exchange rates.

If you are looking for the best exchange rates, send us a free enquiry now. Our rates are up to 5% better than you can achieve at the bank, representing significant savings.

Today's Data

In addition to the budget statement, there is UK House Price data is released today, in addition to mortgage approvals and lending data. Germany has some Retail Sales figures, and the EU releases Industrial Confidence, Consumer Confidence and Economic confidence. From the USA we have consumer confidence and Housing Prices.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

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

Monday 28th November 2011
Good morning. It's the start of a new week, so today we'll take a detailed look at how the currency markets fared last week, in particular Sterling against the Euro and US Dollar.

In this week’s Report:

• Sterling/US Dollar rates hit 7 week low
• EU debt crisis keeps Euro weak
• ECOFIN meeting could affect GBP/EUR levels
• Round up of the week’s data that may affect rates

(For currencies other then GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

It was a slightly less volatile week than we have been used to of late, but we still saw more than 1.5 cents between the high and the low as risky currencies suffered in the early part of the week as Spanish government bonds climbed to a much higher price than was anticipated, and German bonds saw weak demand, raising concerns that German sovereign debt may be losing its safe-haven appeal. Sterling/Euro started to move up from the low seen on Wednesday of 1.1544 and the decline in the single currency was compounded by weak Eurozone industrial data that showed its largest monthly fall in almost three years.













Wednesday also saw the release of the Bank of England minutes from November’s meeting. The committee voted unanimously to hold the bank rate at 0.5% and maintain the current level of Quantitative Easing at £275bn which was largely in line with expectations. The minutes did however shed some light on why we hadn’t seen an increase in the asset purchase program and suggested that further policy moves may be unlikely before February.

Even though inflation is expected to fall below target over the medium term (which gives the BoE more room to expand QE as it normally adds to inflation) it looks like the MPC will take their time in monitoring the impact of the new round of asset purchases and will help them to look at the evidence of how inflation is falling. This by no way means we will not see any surprises from the central bank as the last increase of £75bn in October was quite unexpected and forced the Pound down 3 cents against the Euro in 24 hours; this made a €200,000 purchase £4,500 more expensive in 1 day!

With UK growth seeming to hold steady at 0.5%, and most other UK data remaining positive on the whole, we expect the GBP/EUR cross to be mainly moved by developments in the Eurozone. We have seen poor industry figures and retail sales from most of the main EU economies of late and there is still the real possibility that we could see another interest rate cut when the ECB meet on 8th December which could all weigh on the Euros progress.

It is also possible that Greece will need another round of financial aid before the 9th December which we would expect to restrict the Euro in the meantime, but based on previous bailouts, any help could strengthen the single currency after it is announced. With this in mind we could easily see weeks like earlier in the month where the rate can move 3 cents between the high and low in just a day.

If you need to buy or sell Euros, click here and send me a free enquiry now.

Sterling vs. US Dollar;

Sterling hit a seven-week low against the Dollar on Friday, dragged lower by a weakness in the Euro versus the U.S. currency on worries that European officials were making little headway in solving the Eurozone debt crisis. The Pound fell to $1.545, its weakest since early October, as investors sold currencies perceived to be risky for the safety of the Dollar, boosting it broadly.













The UK currency also struggled in the aftermath of bleak economic outlooks given by Bank of England officials on Thursday, and was poised to post its worst weekly performance versus the Dollar in a year.

The latest knock to Sterling came after BoE policymaker Ben Broadbent on Thursday said Britain risked sliding back into recession, while his colleague David Miles said more quantitative easing was possible.

Markets were relatively quiet towards the end of last week, with trade lightening significantly into the US holiday. After polishing off Thanksgiving turkeys, millions of Americans headed to the shops on Friday for the busiest shopping day of the year. In fact, half of the entire US population was expected to hit the shops at the weekend.

Black Friday (so-called as it is when many retailers head out of the red and into the black) saw many stores open at midnight, or even earlier this year. Consumer spending accounts for about 70% of US economic activity and therefore a fair movement could be expected with the GBP/USD cross. A bad holiday season would raise recession fears again, whereas a strong one would start to dispel those fears. Analysts said that a powerful start to the shopping season could stimulate more hiring of staff by the retail industry, which supports about one-quarter of all jobs in the US.

Barack Obama also noted that: "It's one of the worst days of the year to be a turkey".

If you need to buy or sell US Dollars, click here and send me a free enquiry now.

Weekly Economic Data that may affect exchange rates

Monday – We start the week in the Eurozone, with Inflation and Confidence measures from Germany. In the UK, the only data of note is a trade survey from the CBI. Stateside we see new home sales and building permits.

Tuesday – UK House Price data is released today, in addition to mortgage approvals and lending data. Germany has some Retail Sales figures, and the EU releases Industrial Confidence, Consumer Confidence and Economic confidence. From the USA we have consumer confidence and Housing Prices.

Wednesday – UK data today is quite light, with only Consumer Confidence measures. Today we have the ECOFIN meeting, in which the finance ministers of the 27 member states will discuss various coordinated economic measures. Staying in the Eurozone, we also have a raft of unemployment data from the EU and Germany. There are also EU inflation figures released today. In the USA we have Home Sales, & Non-Farm Productivity. Canada releases GDP data today which could affect GBP/CAD rates.

Thursday – In the UK today we see further House Price data from the Halifax, in addition to some inflation figures. Australia has some releases today including Building Permits and Retail Sales. In the Eurozone there are various inflationary measures. From the USA we have Jobless Claims and Unemployment data.

Friday – We end the week with UK house Price Balance data from the RICS. The EU has some inflation figures, and the USA releases its monthly NonFarm Payroll data which often creates significant volatility for GBP/USD rates due to the numbers being so difficult to forecast.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Sterling hits 7 week low vs US Dollar

Friday 25th November 2011
Good morning. Sterling hit a 7 week low against the US Dollar yesterday, as there have been no signs of progress on resolving the euro zone debt crisis. This prompted investors to shun riskier currencies such as Sterling. Debt problems in the euro zone along with the weakest German bond auction in more than a decade have also weakened the Euro, and at 08:30am this morning rates are as follows:

• GBP/EUR 1.1641
• GBP/USD 1.5481
• GBP/AUD 1.5956
• GBP/NZD 2.0870
• GBP/CHF 1.4294
• GBP/CAD 1.6223
• GBP/ZAR 13.166
• GBP/JPY 119.75
• GBP/DKK 8.6545
• GBP/NOK 9.1253
• EUR/USD 1.3296

UK Economy grows at 0.5%

UK economic growth between July and September was left unchanged in the latest figures from the Office for National Statistics. The Bank of England has forecast that the economy will stagnate in the next three months of this year, and is likely to grow at between 0.7-0.8% next year. The ONS said inventory growth added 0.7% to GDP in the third quarter.

BoE vote 9-0 for rate hold and QE

Earlier this week the Bank of England minutes showed the MPC were unanimous in their vote to keep interest rates on hold and not pursue any further Quantitative Easing. This has given some support for Sterling, however we do expect further QE at some point in the next few months.

Today's Data

There are no significant economic releases today. On Monday, I will post a detailed summary of Sterling/Euro rates and Sterling/Dollar rates over the last week, and a list of economic data to watch for that could affect exchange rates.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Sterling hits 6 week low vs USD

Tuesday 22nd November 2011
Good morning. The Pound fell yesterday to a 6 week low against the US Dollar, and also dropped against the Euro, as investors shunned riskier currencies in favour for safe haven assets such as the USD. The EU debt crisis however is keeping the Euro weak and has limited drops in GBP/EUR rates. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1577
• GBP/USD 1.5681
• GBP/AUD 1.5849
• GBP/NZD 2.0868
• GBP/CHF 1.4310
• GBP/CAD 1.6250
• GBP/ZAR 12.951
• GBP/JPY 120.65
• GBP/DKK 8.6143
• GBP/NOK 9.0538
• EUR/USD 1.3543

Pound falls to 6 week low against the US Dollar

Investors have been seeking safety due to the market turmoil caused by the Eurozone debt crisis. When there is economic uncertainty, investors tend to move away from riskier currencies such as Sterling, and instead seek the perceived safety of the US Dollar. This has strengthened the US Dollar and pushed GBP/USD rates to a 6 week low.

Sterling at risk of further drops this week

There is some key data this week that could push the Pound lower against other currencies. Tomorrow, minutes from the BoE's latest monetary policy committee (MPC) meeting will be released. They left interest rates on hold at the record low of 0.5% and opted not to pursue further QE for the time being.

Analysts however expect the minutes to show the BoE's readiness to extend quantitative easing further. Last week, BoE policymaker Martin Weale said there was a "very strong case" for extending the central bank's QE programme next year. Another BoE policymaker also argued that high inflation was not a threat and the economic outlook had turned out to be grim, as forecast.

This is likely to keep Sterling under pressure, however drops vs the Euro will probably be limited due to the EU debt crisis.

Today's Data

Public Sector borrowing figures are released for the UK today. In the Eurozone there are measures of Consumer confidence. The main data today comes from across the pond, with US Gross Domestic Product and Canadian Retail Sales. We also see the FOMC (US) minutes which can indicate future interest rate movements.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

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

Monday 21st November 2011
Good morning, and welcome to a new week in the currency markets. As customary for Monday mornings, today I will give a detailed assessment of GBP/EUR, GBP/USD, and a full breakdown of economic data releases that may affect exchange rates.

In this week’s Report:

• UK GDP and BoE minutes this week could weaken GBP
• Italy’s bond yields keep Euro weak and GBP/EUR high
• US Dollar strengthens, pushing GBP/USD down
• Round up of the week’s data that may affect rates

(For currencies other then GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

Sterling struggled last week with weak sentiment, and expectations of a slow and protracted economic recovery with GBP/EUR rates hovering a little below an 8 month high, as the chart below clearly illustrates:













A jittery European market rolled over from the week before, with France and Germany clashing again on differing opinions on how best to handle the current economic crisis. One wanting the ECB to do more while the other feeling the ECB lacks the authority to do more. Bond yields crept up towards the 7% mark in Greece, Italy and Spain as analysts discussed the effects of “contagion” spreading.

Rising yields are bad for a currency and the levels of 7% are seen by analysts as unsustainable. As a result the Euro weakened, becoming cheaper to buy and presenting an excellent opportunity for those looking to buy the single currency. Many investors sold the euro in favour of the pound this month on the view that UK assets are safer than some in the euro zone in light of the deepening debt crisis in the region, compounding the supported GBP/EUR levels.

Better news followed for the German and French economies as their 3rd quarter GDP figures recorded growth, 0.5% and 0.4% respectively. The latter half of the week saw mixed economic data from the UK; unemployment rose significantly to near record levels, while UK retail sales returned better than expected despite many analysts predicting a fall. Sterling was also hit by the BoE downgrading the UK economic outlook citing the Eurozone debt issues as the major contributor and growth hurdle.

Sterling remained relatively unscathed, but the week’s economic developments could be a precursor of more volatility in the weeks to come. With poor UK data signalling a possible return of Quantitative Easing by the Bank of England, most analysts are predicting weak performance from the Pound in the coming weeks, so we could see exchange rates fall further depending of course on further developments from the Eurozone.

So just how does this affect you? Buying €200,000 at the current levels compared to just several weeks ago is significantly cheaper by around £6500, clearly demonstrating how volatile the markets can be, and the effect this can have on the cost of a property purchase in just a couple of weeks.

Due to the current rates of exchange, Forward contracts are very popular at the moment, as they enable you to lock into today’s rates for up to two years in advance, and only lodge a 10% deposit of the total you need to convert, thus giving peace of mind and allowing you to budget effectively.

Considering the volatility in the market at the moment, it’s worthwhile having a free consultation with an expert trader to discuss the different strategies and options you can employ to ensure you make the most of your currency.

If you need to buy or sell Euros, click here to send me a free enquiry.

Sterling vs. US Dollar;

It has been an interesting week for the U.S economy with rates dropping away steadily from what was around a three week high as demonstrated in the graph below:













The dollar has been gaining strength off the back of the issues in the Eurozone and much of the focus is away from the U.S. It is still viewed as a safe haven currency because of the fragility of the Euro and investors have been looking towards the greenback as an alternative to the single currency. Another reason for the Dollar‘s gain in momentum is due to the strengthening of the economy after some promising data came out last week. Gains in consumer spending, manufacturing and homebuilding, combined with fewer job losses, point to an economy that is weathering the turbulence in financial markets caused by the debt crisis in Europe.

The general feeling is positive and analysts believe that the U.S can get back to a position of strength, all be it gradually. “The economy looks to be getting better despite the continued drumbeat of negativity in financial markets,” said Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. The gloomy outlook in Europe has benefited the dollar but there are still fears as to the extent the crisis will affect the U.S. A 9% jobless rate and political gridlock over deficit-cutting have hurt confidence, which may be a hurdle to a further pickup in the pace of growth.

The GBP/USD rates look like they are also being kept in check by the performance of the pound. As discussed in the report above there is discussion of more Quantitative Easing (QE) early next year, and the unemployment figures released recently in the UK look like they will quash any extensive gains.

Next week there is important retail sales and manufacturing data released in the U.S. This could be a good indicator of the prospects on the economy and where things are heading in the coming months. As we have seen recently it is a tough time to predict where the rates are going with the pound/dollar pairing. With the on-going European issues, and the continuing stalling growth in the US and UK economies it is vital to keep in touch with an expert trader, to take you through the various options that you have available to you to protect you in these trying times, and make sure that you make the most of your currency.

If you need to buy or sell US Dollars, click here to send me a free enquiry.

Weekly Economic Data that may affect exchange rates

Monday – UK data today comprises of House Price Data. There is no significant data from the Eurozone. The US also releases home sales data today, so the health of the UK and US housing markets will be in focus.

Tuesday – Public Sector borrowing figures are released for the UK today. In the Eurozone there are measures of Consumer confidence. The main data today comes from across the pond, with US Gross Domestic Product and Canadian Retail Sales. We also see the FOMC (US) minutes which can indicate future interest rate movements.

Wednesday – Today there is lots of data from the UK and EU. Starting with UK, we have PMI inflation data and mortgage approvals. We also have the minutes from the latest BoE decision to hold interest rates and QE – the minutes will show how the 9 member committee voted and what was discussed. In the EU, we have inflation data from Germany and the EU. In the USA jobs data is the order of the day, with Unemployment, Jobless Claims, and personal income data. We round the day off with New Zealand Retail Sales.

Thursday – US Markets are closed for Thanksgiving. In Germany we have various GDP measures, in addition to confidence measures. The UK also releases GDP data today, so with so much coming from the EU and UK we expect a choppy days trade for Sterling/Euro.

Friday – There is no data of note released today.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Pound gains after good Retail Sales data

Friday 18th November 2011
Good morning. The Pound rose slightly yesterday, after unexpectedly strong UK retail sales data provided some rare good news on the economy, although the figures did little to alter the overall view that the outlook remained grim. Overnight data showing UK consumer confidence fell to a record low in October also reinforced the gloomy economic picture. At 08:30 am this morning rates are as follows:

• GBP/EUR 1.1703
• GBP/USD 1.5788
• GBP/AUD 1.5806
• GBP/NZD 2.0820
• GBP/CHF 1.4492
• GBP/CAD 1.6246
• GBP/ZAR 12.954
• GBP/JPY 121.21
• GBP/DKK 8.7069
• GBP/NOK 9.1633
• EUR/USD 1.3489

Pound gains on Retail Sales

Data released yesterday morning showed UK retail sales rose 0.6% last month, which was much better than expected as many analysts had predicted a fall. Despite the good data regarding consumer spending however, investors are bracing for more signs of weakness in the UK economy and these concerns have limited gains in the pound.

Many analysts expect the Pound will struggle to rise after the Bank of England cut its UK growth forecasts earlier this week in its quarterly inflation report. As I mentioned a few days ago, this leaves the door open for more quantitative easing where money is created to pump into the economy. This floods the market with pounds to stimulate growth but also devalues the Pound and pushes exchange rates lower.

Pound remains supported against the Euro

Despite a bleak outlook for the UK economy following the poor inflation report earlier in the week, analysts have said that the pound was likely to be supported against the single currency, given concerns of increasing contagion among euro zone sovereigns. This has been keeping the Euro weak, and rates around the €1.17 level. Without the EU debt problems, GBP/EUR rates would be around 5 points lower than they currently are.

Italian government bond yields remain around the critical 7% level, which is seen as unsustainable and also keeping the Euro weak.

Today's Data

We end the week with Canadian Inflation figures, and Producer Price Index data from Germany.

As usual on Monday I will take a detailed look at the movements in the currency markets this week, in addition to a full breakdown of economic data releases that could affect exchange rates.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Sterling falls on growth forecast and unemployment

Thursday 17th November 2011
Good morning. The Pound hit a 1 month low against the US Dollar yesterday after the Bank of England cut its growth and inflation forecasts indicating more QE is on the way. EU debt worries pushed investors towards the safety of the dollar compounding the drop in GBP/USD rates, while the weaker Euro kept GBP/EUR rates supported just below €1.17. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1681
• GBP/USD 1.5738
• GBP/AUD 1.5621
• GBP/NZD 2.0577
• GBP/CHF 1.4493
• GBP/CAD 1.6105
• GBP/ZAR 12.820
• GBP/JPY 121.06
• GBP/DKK 8.6931
• GBP/NOK 9.1129
• EUR/USD 1.3463

Bank of England cut growth forecasts for UK

The UK's economic outlook has worsened and the economy could stagnate until the middle of 2012, the BoE said yesterday . Their quarterly inflation report showed Britain on the brink of contraction and forecast that inflation would eventually fall well below target. This suggests, as many expect, that it may add to its 275 billion pound asset purchase programme.

Further Quantitative Easing will flood the market with Sterling, and the prospect of this has weakened Sterling and pushed exchange rates lower against other currencies.

City analysts said that both lower growth and inflation forecasts showed the Bank would leave interest rates at the low level of 0.5% into 2013.

"The report both endorses market expectations that rates will stay on hold for the foreseeable future and suggests that more policy loosening will yet be needed," said Vicky Redwood, chief UK economist at Capital Economics.

UK unemployment at 17 year high














UK unemployment rose significantly in the 3 months to September to close to 3 million, as youth unemployment rose above 1 million. The Office for National Statistics (ONS) said the jobless rate hit 8.3%.

The number of people out of work and claiming Jobseeker's Allowance rose by 5,300 to 1.6 million in October. The news comes as the Bank of England's governor Sir Mervyn King said Britain's economy could stagnate until the middle of next year.

The poor figures have added to the view that the UK economy is stagnating, and this is being reflected in the lower value of Sterling. In fact, the only thing keeping the Pound supported to some extend is the fact that it's not the Euro! Investors are wary of investing in the EU and this has created some demand for Sterling that is keeping rates higher than they would otherwise be.
Today's Data

Today the UK releases Retail Sales figures. The US has various measures of jobless claims and unemployment.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Pound weakens ahead of BoE inflation report

Wednesday 16th November 2011
Good morning. Sterling fell against the US Dollar yesterday as investors were worried ahead of the Bank of England's Quarterly Inflation Report, which is expected to be dovish and clear the way for more monetary easing. Against the Euro however rates remain stable due to the EU debt crisis keeping the Euro weak. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1703
• GBP/USD 1.5795
• GBP/AUD 1.5583
• GBP/NZD 2.0538
• GBP/CHF 1.4501
• GBP/CAD 1.6177
• GBP/ZAR 12.8755
• GBP/JPY 121.50
• GBP/DKK 8.7075
• GBP/NOK 9.1051
• EUR/USD 1.3493

Sterling weakens ahead of BoE Inflation report

Today we have an inflation report by the Bank of England. Many in the markets expect it to be quite dovish, and pave the was for further monetary stimulus with the BoE pumping more money in the economy through Quantitative Easing. Such speculation is sterling negative as quantitative easing involves flooding the market with pounds to stimulate growth, reducing demand for the UK currency.

This has weakened Sterling and pushed exchange rates down against most currencies.

Pound remains stable against the Euro

Despite the focus on the BoE report weakening the Pound against other currencies, analysts said the key driver for investors remained the euro zone debt crisis as yields on benchmark Italian government bonds rose back above the critical 7 percent level on Tuesday. This has been keeping the Euro weak, and means GBP/EUR rates have not dropped like other currency pairs.

"Within Europe, sterling has a bit of a safe haven tinge but the bigger picture is of a slightly stronger dollar across the board," said RBS's Robson. "That's why cable is falling but not as quickly as euro/dollar is falling."

Many investors have sold the euro in favour of the pound this month on the view that UK assets are safer than some euro zone ones in light of the deepening debt crisis in that region. The weak Euro is therefore cheaper to buy, and exchange rates are close to an 8 month high as a result.

The Dollar has also strengthened due to it's safe haven status, and GBP/USD rates have fallen back into the $1.57's. This is only due to the EU crisis however, and not due to any fundamental strength in USD. Once focus shifts from the Eurozone we expect rates to recover back above $1.60.

Today's Data

In addition to the inflation report, unemployment figures from the UK today could affect Sterling. EU inflation figures may impact future EU interest rate decisions. In the USA we have various inflationary measures. There are also inflation figures from New Zealand today that could affect GBP/NZD rates.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Pound gains vs Euro on Italy bond yields

Tuesday 15th November 2011
Good morning. Sterling fell against the US Dollar yesterday, tracking losses in the euro against the safe-haven U.S. currency as deep-seated concerns about the euro zone's huge debt problems outweighed investor optimism over a new Italian government. This has weakened the Euro and pushed GBP/EUR rates up, but strengthened the USD pushing GBP/USD rates down. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1697
• GBP/USD 1.5914
• GBP/AUD 1.5607
• GBP/NZD 2.0540
• GBP/CHF 1.4515
• GBP/CAD 1.6212
• GBP/ZAR 12.774
• GBP/JPY 122.47
• GBP/DKK 8.7062
• GBP/NOK 9.1093
• EUR/USD 1.3598

Euro weakens on Italy bond yields

At the weekend we saw a new Prime Minister appointed in Italy, and in what was seen as the first test of his leadership, Italy sold 3bn euros of 5 year bonds yesterday. However, it had to pay more to borrow the money, a rate of 6.29%, indicating continuing unease in the markets.

Late last week, the level had soared to above 7%, the rate at which Greece, Ireland and Portugal were obliged to seek emergency bailouts from the EU. The rate of 7% is significant as that's where markets think they will be unable to repay the debts, increasing the chance of needing bailout funds.

As a result, the Euro weakened yet again and pushed GBP/EUR rates back to €1.17 this morning. The uncertainty also helped strengthen the safe haven US Dollar, pushed rates back towards $1.59.

German and French economies grow

Both the German and French economies recorded growth in the 3rd quarter, figures showed yesterday. Germany's GDP grew by 0.5%, and the French economy grew by 0.4%. Both of these were better than expected, but were overshadowed by the continuing debt problems, and so we still saw a net weakness in the Euro.

UK economy still a concern

The Bank is widely expected to cut its forecasts for UK growth, which could pose downside risks for sterling. Figures on UK employment and retail sales this week may put the pound under further selling pressure if they show the economic recovery is continuing to struggle. Markets still expect further Quantitative Easing in December or January, so the Pound remains vulnerable to more falls.

Today's Data

UK data today includes the Retail Price Index and Consumer Price index. In the EU we see GDP figures from Germany and the EU, and Economic sentiment survey from Germany and the EU, and EU Trade Balance figures. In the USA we see Retail Prices & Inflation data.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

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

Monday 14th November 2011
Good morning. As usual for a Monday, today I'm going to look at last weeks movements for our two most traded currency pairs GBP/EUR & GBP/USD. We'll also have a round up of the economic data to watch for that may affect rates for the coming week.

In this week’s Report:

• Pound/Euro rates briefly hit 8 month high
• Italy vote through austerity measures
• EU debt crisis continues to drive exchange rates
• Round up of the week’s data that may affect rates

(For currencies other then GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

Sterling relinquished gains against a broadly recovering euro on last Monday, but its downside was limited as investors considered the pound a safer bet versus the single currency due to political instability in Greece and Italy, which are plagued by debt problems. Rates soared last week to an 8 month high, however the gains were short lived.













Some analysts recommended selling sterling citing recent weak UK survey indicators and downside risks to the economy that would hamper efforts to reduce the deficit also adding that they expected more quantitative easing from the BoE early next year, "We do not expect any significant turn in the weak sterling trend until there are meaningful improvements in the housing and banking sector, none of which have been seen yet".

Some in the market considered this a sign that investors expect the pound to fall further, while some analysts argued the figures show there is room for the pound to rise in the near future. Still, few expect significant gains in Sterling. A much stronger than expected UK house price survey last Monday failed to boost sterling much after previous week's poor UK purchasing managers' surveys on manufacturing and services highlighted the risk of recession.

Key Mid-week economic data from the UK turned out a bit of a non-event as the BoE decided to keep record low interest rates on hold at 0.5% and refrained from adding further QE for the time being. Despite domestic economic threats GBP/EUR rates hit an eight-month high as Italy's growing debt problems continued to hit the single currency. Rates rose to €1.1780, their highest since late February, and analysts suggest sterling's outlook versus the single currency continued to hinge on developments in the euro zone debt crisis.

To wrap up the week Sterling dropped some of its gains against the euro as focus remained on developments within the euro zone where Italy voted on austerity measures in a bid to convince European officials and bond markets that it can address its fiscal problems. After winning support in the Italian senate, the vote meant Prime Minister Silvio Berlusconi had to step aside for a new unity government. That prospect drove investors to unwind some of their bearish bets against the euro, lifting the shared currency versus Sterling and off the 8 month highs.

By and large last week was pretty good week for Sterling/Euro rates, and those who took advantage of its spike vs. the Euro, however volatility and uncertainty continue to surround the currency pair with developments in the Eurozone debt crisis acting as both friend and foe. At this stage Sterling isn’t too far off the 8 month highs and FWD buying Euro’s could still a viable and prudent option.

If you want the best exchange rates for Euros, make a free enquiry now.

Sterling vs. US Dollar;

Sterling had somewhat of a Jekyll and Hyde week last week. Whilst the Pound saw some major movements on the upside against an increasingly beleaguered Euro, the fortunes of the Sterling against the Greenback were almost exactly the opposite with very little movement all week long - and what little movement there was pushed the pound down against the Dollar.













Whilst the rest of the world focused on Italy and the rest of the Eurozone, the market didn’t seem to notice and react too much that year on year Retail sales in the UK were down 0.6% indicating continued sluggish consumption in the UK, prompting fears that this trend may continue to hinder British economic performance moving forward. However, on the upside for the UK the ‘National Institute of Economic and Social Research’ said on Tuesday that growth in the UK held steady at 0.5% for the 3 months to October calming speculation that the UK is heading towards another recession.

However, concerns about a very fragile recovery remained as data showed industrial output flatlined despite a modest rise in manufacturing. As expected, the Bank of England voted to keep interest rates at a record low 0.5% on Thursday and opted not to raise the amount set aside for the quantitative easing programme. Following the announcement Sterling edged slightly lower against Cable, however this was perhaps more to do with problems in the Eurozone which pushed more global funds out of other currencies and into the Greenback which is universally regarded as the world’s safe haven currency.

This Dollar strength naturally put pressure on Sterling which fundamentally still remains a relatively weak world currency, although perhaps not as weak as the Euro last week. Next week there is a raft of US and Anglo data released throughout the week although it is likely that again all eyes within the market will remain fixed on the Eurozone to see whether the crisis settles with a new Greek Premier in place and the probable exit of Berlusconi and new austerity measures implemented.

If you need the best exchange rates for US Dollars, make a free enquiry now.

Weekly Economic Data that may affect exchange rates

Monday – A quiet start to the week, with the only data of note coming from the Eurozone in the shape of Industrial Production figures.

Tuesday – UK data today includes the Retail Price Index and Consumer Price index. In the EU we see GDP figures from Germany and the EU, and Economic sentiment survey from Germany and the EU, and EU Trade Balance figures. In the USA we see Retail Prices & Inflation data.

Wednesday – Unemployment figures from the UK today could affect Sterling. EU inflation figures may impact future EU interest rate decisions. In the USA we have various inflationary measures. There are also inflation figures from New Zealand today that could affect GBP/NZD rates.

Thursday – Today the UK releases Retail Sales figures. The US has various measures of jobless claims and unemployment.

Friday – We end the week with Canadian Inflation figures, and Producer Price Index data from Germany.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Pound falls from 8 month high vs Euro

Friday 11th November 2011
Good morning. The Bank of England didn't announce any further Quantitative Easing yesterday, but Sterling still dropped against the dollar and has also fallen against the Euro as worries about the euro zone drove investors to shed exposure to riskier currencies. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1668
• GBP/USD 1.5930
• GBP/AUD 1.5690
• GBP/NZD 2.0483
• GBP/CHF 1.4423
• GBP/CAD 1.6243
• GBP/ZAR 12.667
• GBP/JPY 123.25
• GBP/DKK 8.6828
• GBP/NOK 9.0384
• EUR/USD 1.3645

Bank of England leave interest rates and QE on hold

As expected yesterday the Bank of England left interest rates at a record low 0.5% and opted not to pump any more money into the economy through quantitative easing. Markets will now focus on next weeks inflation report which could reveal the extent of weak economic fundamentals in the UK, and this could mean more QE in December.

Pound falls vs Euro

Despite no further QE, the Pound has fallen against most currencies including the Euro. It's because of the problems in the Eurozone, and the uncertainty means investors have been shedding riskier currencies and heading for the safe haven US Dollar. This has pulled rates down slightly from the 8 month high seen yesterday.

Today's Data

Most markets are closed in the EU and US due to Armistice Day/Veteran's day. There are some inflation numbers from the UK.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Sterling/Euro hits 8 month high on Italian Bonds

Thursday 10th November 2011
Good morning.The Pound rose to an 8 month high yesterday against the Euro, after Italian bond yields rose to level of 7%, seen as unsustainable and taking the EU debt crisis to new levels. Sterling dell against the US Dollar however, as investors sought the safe haven status of the currency and by worries that the crisis in Britain's euro zone trading partners could push the UK economy back into recession. Rates at 08:30am are as follows:

• GBP/EUR 1.1753
• GBP/USD 1.5917
• GBP/AUD 1.5768
• GBP/NZD 2.0517
• GBP/CHF 1.4464
• GBP/CAD 1.6307
• GBP/ZAR 12.763
• GBP/JPY 123.47
• GBP/DKK 8.7469
• GBP/NOK 9.1246
• EUR/USD 1.3542

Italian Bond Yeilds weaken the Euro

Italy's cost of borrowing has touched a new record, a day after Prime Minister Silvio Berlusconi said he would resign once budget reforms were passed. The rate has risen to 7% which is widely seen as unsustainable, and Italy would not be able to repay debts at this rate. The net result is that investors fear that Italy could become the next victim of the debt crisis.

The euro fell almost three cents against the dollar and also fell against Sterling. The net result is GBP/EUR rates surging to their best since near the start of the year, and 5 points higher than just 2 weeks ago, creating excellent buying levels for those wishing to buy Euros.

If you need Euros in the next 6 to 12 months, contact us today to discuss our forward contracts, where you can lock in the current exchange rate, but only pay 10% of what you want to convert now, and the rest when you need your currency. This will protect you against a fall in the rate.

Bank of England meeting today

Today at 12:00pm the Bank of England will announce their interest rate and Quantitative Easing decisions. It's expected that the BoE will leave interest rates on hold, but there is a chance further QE will be pursued which could reverse the gains in GBP/EUR and push rates lower.

Also weighing on sentiment towards the pound, data on Wednesday showed Britain's trade deficit deteriorated much more than expected in September to 9.814 billion pounds, its widest since the series began in 1998.

The Confederation of British Industry said the risk of another recession had risen as it cut its forecasts for UK economic growth, although it believed Britain could avoid this. Consistent weakness in the UK economy prompted the Bank of England to adopt further quantitative easing last month, which is often considered currency negative as it involves flooding the market with pounds.

Today's Data

The busiest day of the week for data. Today the Bank of England announces their latest decision on interest rates. They are likely to be left on hold again, but some in the market predict there is a risk they will embark on another round of Quantitative Easing – if so expect GBP rates to fall.

In Australia we have employment figures. Germany releases inflation numbers which could drive EU interest rates. In the USA we will see Jobless numbers, a budget statement from FED.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Wednesday 9th November 2011
Good morning. Sterling rose against the US Dollar and the Euro yesterday, after the National Institute of Economic and Social Research (NIESR) said British economic growth held steady at 0.5% in the last 3 months. The news also that Italian PM Silvio Berlusconi is set to resign has weakened the Euro slightly. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1670
• GBP/USD 1.6093
• GBP/AUD 1.5570
• GBP/NZD 2.0257
• GBP/CHF 1.4454
• GBP/CAD 1.6272
• GBP/ZAR 12.710
• GBP/JPY 124.81
• GBP/DKK 8.6861
• GBP/NOK 9.0421
• EUR/USD 1.3785

UK GDP at 0.5%

NIESR's forecast of 0.5% growth yesterday helped calm fears that the UK could be slipping back into recession, though concerns about a very fragile recovery remained as data showed industrial output flatlined despite a modest rise in manufacturing.

"The forecast of GDP growth staying steady through to October from NIESR has supported sterling a little," said Lee McDarby, head of dealing for corporate and institutional treasury at Investec.

The figures helped push the Pound slightly higher against both the Euro and the US Dollar.

Silvio Berlusconi set to resign

Italian PM Silvio Berlusconi says he will not stand if Italy holds early elections, a day after promising to resign as soon as parliament passes urgent budget reforms.

"I will resign as soon as the law is passed, and, since I believe there is no other majority possible, I see elections being held at the beginning of February and I will not be a candidate in them," he said.

There are serious problems in Italy at the moment. It is a country of anaemic growth and a debt mountain of £1.6 trillion. There are fears the debt crisis will spread from Greece to Italy, and this has weakened the Euro and the reason exchange rates are significantly higher than they would otherwise be.

Today's Data

A few bits to watch for from the UK today: BRC Shop Prices, Trade Balance and Goods Balance. The Trade figures in particular could affect the value of the Pound. Not much else of interest today other than some Inflation data from New Zealand.

Tomorrow we have the BoE decision on whether to pump even more money into the economy through their Quantitative Easing programme.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Get best exchange rates to buy Euros

Tuesday 8th November 2011
Good morning. Political uncertainty is rife in the Eurozone. We have Greece attempting to put together a coalition government, and today Italys Prime Minister Silvio Berlusconi is facing a crucial vote on the budget, amid fears that Italy could be the next victim of the eurozone debt crisis. This has kept the Euro weak and helped push GBP/EUR rates and GBP/USD rates slightly higher. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1667
• GBP/USD 1.6065
• GBP/AUD 1.5557
• GBP/NZD 2.0169
• GBP/CHF 1.4502
• GBP/CAD 1.6314
• GBP/ZAR 12.723
• GBP/JPY 125.25
• GBP/DKK 8.6842
• GBP/NOK 9.0225
• EUR/USD 1.3764

Political Instability in the Eurozone

Borrowing costs for Italy's government have risen significantly due to fears it may be unable to repay its huge debts. Yesterday Berlusconi dismissed reports he planned to resign and today EU finance ministers are due to meet in Brussels for further talks on the debt crisis.

Concerns over Italy are overshadowing developments in Greece, where political leaders are wrangling over the formation of a new unity government to impose austerity measures in return for international loans. Stock markets across Europe bounced up on the chance of the Italian premier's departure but returned to negative territory at Monday's close.

Buying Euros at the best exchange rates

This has kept the Euro weak and GBP/EUR rates high. For those buying Euros, it's worth noting rates are relatively good at the moment, while only a few weeks ago trading levels were in the €1.12's. Some clients may wish to hold out hoping rates will rise further, but what do we need to see for rates to rise further?

What you need to see is strength in Sterling, or weakness in the Euro. The Pound is unlikely to strengthen any further as we have more Quantitative Easing on the way, high unemployment, rising inflation, low interest rates and stagnant growth that threatens to push the UK back into recession. So, not much here that will push the Pound higher.

On the Euro side, what else could we possibly see that would cause more weakness? We already have Greece on the brink of collapse, fears Italy and Spain will follow suit, all of which has already been priced in the market. It's these issues in the EU that are keeping rates where they are.

Strategies to employ to get the best Pound/Euro exchange rate

If you need to buy Euros then consider fixing the current rate with a Forward contract. This is where you can fix the current rate for up to 2 years, and only put down 10% of the total Sterling you want to convert. This then protects against adverse rate movements and allows you to budget.

If you do think that rates will rise further, then you should place a Stop Loss order. this is where you place an order to buy your currency if rates should fall below a pre-agreed level. In this way you can still aim for a higher rate, but have a worst case scenario should rates drop.

Employing strategies like this often help you get the best exchange rates, rather than just hope rates will move your way. Hope is not a reliable economic tool!

To discuss our best exchange rates, contact us now by clicking here.

Today's Data

Pretty busy for UK data: Retail Sales, House Prices, Manufacturing Production, Industrial Production and a GDP estimate. So lots today that could affect Sterling exchange rates. Australia releases Trade Balance numbers. From the Eurozone the only release of note is German Trade Balance figures. There are no significant US releases today.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

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

Monday 7th November 2011
Good morning. As regular readers will know, every Monday I take a detailed look at what has happened to exchange rates over the last week, in particular the GBP/EUR cross and GBP/USD cross, and also a detailed outline of economic data releases I think will affect exchange rates.

In this week’s Report:

• EU debt crisis dominates G20 Summit
• Greek turmoil continues – referendum or no referendum?
• ECB in surprise interest rate cut
• Round up of the week’s data that may affect rates

(For currencies other then GBP, EUR and USD, contact us for a consultation)

Sterling vs. Euro;

There were fireworks in the currency market last week following the announcement of a Greek referendum on the latest aid package to solve its debt crisis. With a bailout package agreed, the Euro had gained strength against the pound and at the start of the week GBP/EUR was hovering in the high 1.13’s. With the news of the referendum taking place as early as December the gains did not last long, GBP/EUR rocketed back the highs we saw a few weeks ago and for the remainder of the week we saw the rate trading around 1.16:













There was sense of relief last week as EU leaders emerged from late-night talks, hammering out the deal which would write off half of Greece's debt and give another €100bn to the country in new bailout funds. But in one stroke, that relief turned to panic as the whole agreement was threatened with disaster and markets worldwide plummeted. This was all thanks to the astonishing announcement by Greek Prime Minister Papandreou that a public referendum would be held on whether Greece should accept this latest debt deal.

The announcement was coldly received by German Chancellor Angela Merkel and French President Nicolas Sarkozy, bringing accusations the move would intensify the euro zone crisis.
On Thursday there was news the referendum had now been scrapped, amid calls for Mr Papandreou to resign. The developments have overshadowed a key G20 meeting in Cannes. Eurozone leaders fear that failure to solve the Greek debt crisis could risk it spreading to other vulnerable economies, particularly Italy.

Germany had said a referendum would essentially be a vote on whether Greece wanted to be part of the EU and that the stability of the Eurozone was more important than Greek membership. Last week’s events saw a rise in the number of forward contracts being booked as clients look to take advantage of the unexpected rise.

As we have seen over the last few weeks, the continued volatility in the foreign exchange markets has provided huge swings in the exchange rate. With all the economic uncertainties across the Europe exchange rates are likely to remain extremely unstable over the next few weeks, therefore if you are buying or selling Euros in the next 6 months, contact us today for a free consultation.

Sterling vs. US Dollar;

GBP/USD rates dropped off from what was almost a seven week high on Tuesday with Greece's shock decision to hold a referendum on an EU bailout. This news pushed investors towards the relative safety of the US Dollar which strengthened causing GBP/USD rates to fall away.

Much of the attention is back at home in the States as Obama’s Democrats battle Republicans to agree deep deficit cuts amid high U.S. unemployment - something that could hold the key to his hopes for re-election next year. For this reason President Barack Obama has ruled out any grand financial gesture for Europe at the moment but backs were raised at the White house during last week from comments made at the G20 summit.













There is a suggestion that U.S. power within the G20 has diminished with the budget woes back home and Europe appear to look toward an economically self-confident China for help. White house aide Michael Froman went on the defensive saying that "Our ability to contribute, our ability to lead and our ability to influence the outcome of these sorts of issues is not tied necessarily to having the American taxpayer pay for every problem,"

Washington has made no suggestion that it might come to Europe's aid. Instead, the White House argues Europe has the resources to help itself and whilst the U.S economy is the largest in the World, it means that Capital Hill’s views still carry great weight.

Key data was released on Friday with Non-farm payrolls and Unemployment figures published. The U.S. added 80,000 new jobs in October and the unemployment rate fell to a six-month low of 9% from 9.1%. Even though the data was positive for the economy it was less than had been forecast. These figures caused the dollar to only make minimal gains against the pound and analysts agree that job creation needs to be a lot faster to make a dent in the unemployment rate
Last week ended with GBP/USD rates hovering around $1.60 (interbank).

Worries about the fragility of the UK economy continued to weigh heavily on the cross with Sterling unable to gain any real momentum against the dollar. Lee Hardman, currency economist at BTMU said - “It is difficult to envisage it breaking higher when the UK looks like it may be on the verge of recession,".

The situation continues to hang in the balance with both the U.S and U.K. economies tied in to any sort of resolution in Europe. It is difficult to know what will happen, but what we do know is that timing is essential to making the most of your currency. If you are looking at purchasing or selling currency in the coming weeks, months or years click below to open a free, non-obligation trading facility and let a currency specialist talk you through these volatile times.

Do you need to buy or sell US Dollars? Send me an enquiry now.

Weekly Economic Data that may affect exchange rates

Monday – EU Retail Sales are released today which reflect how confident consumers are about the economy. Other than that there are some German industrial Production figures. There is no UK data today.

Tuesday – Pretty busy for UK data: Retail Sales, House Prices, Manufacturing Production, Industrial Production and a GDP estimate. So lots today that could affect Sterling exchange rates. Australia releases Trade Balance numbers. From the Eurozone the only release of note is German Trade Balance figures. There are no significant US releases today.

Wednesday – A few bits to watch for from the UK today: BRC Shop Prices, Trade Balance and Goods Balance. The Trade figures in particular could affect the value of the Pound. Not much else of interest today other than some Inflation data from New Zealand.

Thursday – The busiest day of the week for data. Today the Bank of England announces their latest decision on interest rates. They are likely to be left on hold again, but some in the market predict there is a risk they will embark on another round of Quantitative Easing – if so expect GBP rates to fall. In Australia we have employment figures. Germany releases inflation numbers which could drive EU interest rates. In the USA we will see Jobless numbers, a budget statement from FED.

Friday – US Markets are closed for Veterans Day. The UK releases various measures of inflation.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

EU Cut interest rates, Greek farce continues

Friday 4th November 2011
Good morning. Sterling rose against the Euro yesterday and also rose from a 2 week low against the US Dollar, helped by the European Central Bank's surprise decision to cut interest rates, which supported riskier assets. There is also uncertainty in Greece where there will now not be a referendum on the bailout, as the prime minister said he would scrap the move if the conservative opposition party voted to pass the bailout package in parliament. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1587
• GBP/USD 1.5999
• GBP/AUD 1.5420
• GBP/NZD 2.0183
• GBP/CHF 1.4165
• GBP/CAD 1.6213
• GBP/ZAR 12.5804
• GBP/JPY 124.84
• GBP/DKK 8.6226
• GBP/NOK 8.9615
• EUR/USD 1.3803

ECB cut interest rates

The European Central Bank (ECB) surprised the markets yesterday when they cut eurozone interest rates to 1.25% from 1.5%. The new ECB president Mario Draghi told a news conference that growth in the eurozone was likely to remain weak. He said that Europe's financial crisis and a slowdown in global growth meant the euro area faced an "environment of high uncertainty".

Usually an interest rate cut would weaken a currency due to the lower return on offer, however in the current volatile market, the move actually supported riskier currencies, and the development that there will now not be a referendum in Greece actually strengthened the Euro slightly, and exchange rates dropped back in the €1.15's.

Greece farce continues

The second day of the G20 meeting today will see the Greek prime minister George Papandreou face a confidence vote in parliament. The opposition have called for him to quit after his decision earlier this week to hold a referendum on the bailout sparked a turmoil on financial markets and upset both Germany and France.

Yesterday however he said he would scrap the move if the conservative opposition party voted to pass the bailout package in parliament. However, there are fears that he may lose the confidence vote and Greece may have to hold fresh elections, a move which may further delay the implementation of a Greek bailout package.

The mess in Greece caused some turmoil in the markets. Initially after the interest rate cut GBP/EUR rates rose but after the news from Greece, rates fell back away again as the threat of a referendum on whether Greece stays in the Euro subsided and calmed the markets.

Sterling still at risk however due to poor economic outlook

Despite the latest rise for Sterling, analysts said that the Pounds prospects are not looking very good, with the National Institute of Economic and Social Research lowering growth prospects.

They said there is now a 50% chance of a new recession and that is likely to ramp up expectations of more quantitative easing from the Bank of England in coming months. The Monetary Policy Committee will meet next week and the chances are it may consider more easing.

More QE would weaken Sterling and lower exchange rates.

Today's Data

The G20 meeting continues today. From the Eurozone we have further inflation numbers, this time the Producer Price Index. In Canada there are Unemployment and Building permit figures. In the USA we will see Non-farm payroll & unemployment data.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Eurozone in crisis ahead of Greek vote

Thursday 3rd November 2011
Good morning. Sterling rose slightly against the US Dollar and Euro yesterday, as the Greek referendum took centre stage and weakened the Euro. Markets' focus turns to monetary policy meetings in the U.S. and Europe today, and also the G20 meeting where Europe's escalating debt crisis is set to be the main subject of discussion. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1623
• GBP/USD 1.5923
• GBP/AUD 1.5551
• GBP/NZD 2.0281
• GBP/CHF 1.4121
• GBP/CAD 1.6210
• GBP/ZAR 12.8013
• GBP/JPY 124.20
• GBP/DKK 8.6462
• GBP/NOK 9.0396
• EUR/USD 1.3700

Eurozone in crisis ahead of Greek vote

The eurozone has been plunged into renewed turmoil by Greece's decision to hold a referendum on the EU's offer to bail out its stricken economy. EU leaders fear that should Greece deliver a "no" vote it may plunge the country into a disorderly default and spread financial contagion to Italy and Spain. The developments have weakened the Euro and pushed rates higher in the last few days.

Last month the European Commission, the European Central Bank (ECB) and the International Monetary Fund (IMF) said they had reached agreement with Greece on reforms to put the nation back on track. They have now however suspended the next bailout of €8bn in and called on Athens to decide whether or not to remain in the eurozone.

Eurozone leaders fear that should Greece deliver a "no" vote it may plunge the country into a disorderly default and spread financial contagion to Italy and Spain.

EU Interest Rates today

At 12:45pm we have the ECB interest rate decision. Rates will probably be left on hold, but in the press conference afterwards watch for any sign rates may be cut in the coming weeks. Any negative comments could weaken the Euro and push GBP/EUR rates higher.

China's EU aid in doubt

China has said it cannot commit to investing in the European Financial Stability Fund (EFSF) until the situation with Greece has been clarified. European leaders hoped that China would buy EFSF bonds, injecting capital in the region's financial markets. The EFSF was one part of a three pronged rescue plan put together to solve eurozone's debt crisis.

UK at risk of falling back into recession

There is a strong chance the UK will fall back into recession even if eurozone leaders find a resolution to the debt crisis. NIESR said that whatever the outcome of the G20 meeting, the UK could well return to recession by the end of 2012. This could of course weaken Sterling and push rates lower.

Today's Data

Australian retail sales are released today. There is the G20 meeting also that may throw up a few surprises. In the USA there are jobless numbers. In the EU we have an interest rate decision followed by a press conference – this often causes swings in GBP/EUR rates

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Sterling vs Euro forecast hits 1 month high

Wednesday 2nd November 2011
Good morning. Sterling rose to a 1 month high against the Euro yesterday after Greece's decision to hold a referendum on an EU bailout. This highlighted concerns that the debt crisis is far from over and weakened the Euro. This also pushed investors towards the relative safety of the US Dollar which strengthened causing GBP/USD rates to drop. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1618
• GBP/USD 1.6010
• GBP/AUD 1.5376
• GBP/NZD 2.0073
• GBP/CHF 1.4135
• GBP/CAD 1.6244
• GBP/ZAR 12.782
• GBP/JPY 124.97
• GBP/DKK 8.6430
• GBP/NOK 9.0200
• EUR/USD 1.3776

Sterling hits 1 month high vs Euro

Only a week ago there seemed to be a resolution to the debt crisis when EU leaders voted through measures to help Greece. This had strengthened the Euro and pushed GBP/EUR rates down in the low 1.13's. However it now seems that the prospect of a swift end to the euro zone's debt crisis is not as secure as first thought, after the Greek Prime Minister called a referendum on the latest bailout package, drawing calls from within his own party to step down.

This caused the Euro to weaken again, highlighting how volatile the currency markets are to any bad news. The euro fell against sterling pushing rates to their highest in nearly a month.

Against the US Dollar however, the bad news from the EU pushed investors back to the safe haven US Dollar, strengthening it and making it more expensive to purchase. Also adding momentum to the pound's slide against the dollar was an unexpected contraction in UK manufacturing activity. This has drawn attention to concerns about the economic outlook despite slightly better GDP figures yesterday. This weakened the Pound slightly.

The UK economy may be on the brink of recession according to data showing manufacturing contracted at its fastest pace in more than two years. There are further PMI figures today and if the are also weak, this will likely weaken Sterling further.

Today's Data

Today we see the minutes from the US decision to hold interest rates. Staying in the states we also see mortgage applications, employment data, and at 16:30 there is an interest rate decision. There is little UK data today other than PMI construction. There is a lot to watch out for from the Eurozone: German unemployment in addition to German and EU inflation data.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

If you need to buy or sell foreign currency, click below now to send us an enquiry for free. Our exhange rates are up to 5% better than offered by banks. Take the first step to making the most of your currency now.

Pound vs Euro exchange rates rise November 2011

Tuesday 1st November 2011
Good morning. Sterling has surged against the Euro, rising by nearly 3% since last week, and has now sitting in the mid €1.16's. The Pound is being driven by external factors: investor perception about the US Dollar and Euro, in addition to the intervention by the Japanese has pushed the dollar higher and strengthened Sterling. At 08:30am this morning rates are as follows:

• GBP/EUR 1.1666
• GBP/USD 1.5967
• GBP/AUD 1.5445
• GBP/NZD 2.0027
• GBP/CHF 1.4192
• GBP/CAD 1.6138
• GBP/ZAR 12.851
• GBP/JPY 124.68
• GBP/DKK 8.6811
• GBP/NOK 9.0108
• EUR/USD 1.3687

Sterling rises against Euro November 2011

The Pound has risen well against the Euro so far this week, with European markets opening lower this morning, following an announcement yesterday on a Greek referendum on the latest aid package to solve its debt crisis. Eurozone leaders had agreed a €100 billion loan to Athens and a 50% debt write-off last week, however the announcement of a referendum has cast doubt on whether the deal will be able to go ahead.

This has weakened the Euro, and made it cheaper to purchase. Sterling vs Euro exchange rates have surged as a result, and we are now sitting not far from €1.17, when only last week rates nearly dropped into the €1.12's.

If you need to buy Euros, you should consider locking in the current rate with a Forward contract. this is where you can lock in the current rate for up to 2 years, but only lodge 10% of the total amount of Sterling you need to convert. You will then be protected against a drop in rates. Click here to send us a free enquiry about Forward Contracts.

UK Gross Domestic Product today

This morning at 09:30am we will see the UK's GDP figures. This will show how the economy is growing and we expect a 0.3% gain in the 3 months until September. If the figure is lower than this however, then expect Sterling exchange rates to drop.

The other concern is further Quantitative Easing by the UK. This could also weaken the Pound, and so we think the gains in GBP/EUR will be short lived, making it even more important to contact us to discuss forward contracts if you need to buy Euros in the next 6 months.

US Dollar weakens

US brokerage firm MF Global has filed for Chapter 11 bankruptcy protection after revealing £4bn of eurozone debt exposure. MF Global worried markets last week after disclosing a $191.6m quarterly loss. This saw its shares fall by two thirds, and its credit rating cut to junk.

The result for exchange rates is the Dollar weakened pushing GBP/USD rates higher, however the issues in Europe have now swung the pendulum the other way: weakness in the Euro drives investment towards the US Dollar, and this has created strength this morning pushing rates back below the $1.60 mark.

Today's Data

Australia releases House Price data and there is also an interest rate decision. In the UK we will see Gross Domestic Product figures – these are important as it shows at what rate if any the economy is growing. There is some minor construction data from the USA.

Getting the Best Exchange rates

Our rates are up to 6% better than you can achieve at the banks. For any large currency purchase this represents a huge saving. If you are reading this currency report, the chances are you have an interest in getting the best exchange rates.

Click here to send us a free no obligation enquiry now, and find out how much we can save you.