Pound/Euro exchange rate forecast

Sterling/Euro rates fall ahead of ECB meeting this week 

Pound/Euro rates have recovered in the last week, partly due to some positive UK employment data, but also due to speculation the European Central Bank (ECB) may announce further stimulus this week. Interest rates there are as low as they can go (0.05%), and in order to ward of the threat of deflation, they may have to increase their stimulus measures. I don’t think they’ll announce anything on Thursday, but it’s important to listen out for any hints the ECB president Mario Draghi may give in his press conference. 

To me it’s quite obvious that their QE programme will need extending, and that’s why the Euro has been weakening off in recent days as this eventuality gets priced into the market. However today the market starting correcting itself, pulling GBP/EUR back down to around the €1.36 level as you can see from the chart below. If he does hint at further measures, there may be a short term spike in GBP/EUR rates. 

If you need to buy Euros, then it’s worth looking into placing a ‘Limit Order’ to take advantage of any spike we may see. This works by placing a target level with me that may be above the current rate. If the market does spike and your level becomes available, your trade is executed automatically and your currency is purchased. 

What else could affect exchange rates this week? 

Wednesday 21st October 2015 – Today the UK government releases its Public Sector Borrowing figures, which show the amount of debt they hold. The last release showed a deficit of £11.3bn, and today I expect this number to be around £9bn. If it’s higher than this, then Sterling exchange rates could fall, and vice versa. Later in the day there is another Speech by BoE Governor Mark Carney, and any hints about UK interest rates could also affect the Pound. Elsewhere, those with an eye on GBP/CAD rates should look out for the Bank of Canada’s (BoC) rate decision and policy statement. 

Thursday 22nd October 2015 – It’s quiet in the UK today, but over in the Eurozone we have the European Central Bank (ECB) decision on interest rates. As I mentioned at the top of this report, while it’s highly unlikely interest rates will change, the press conference at 13:30pm is very important for Sterling/Euro buyers, because there may be hints at further stimulus in the EU. If that proves to be the case, expect the Euro to weaken pushing GBP/EUR higher. Elsewhere, the USA has Jobless data and House Price info. 

Friday 23rd October 2015 – Nothing for the UK today, but GBP/EUR could be affected by EU and German inflation numbers. Canada and the USA also release inflation numbers today that could affect GBP/CAD and GBP/USD respectively. 

If you would like to find out more about what moves exchange rates, or would like a quote on your exchange, then send me a free enquiry by clicking below. 

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Why has Pound/Euro dropped to €1.36?

Wednesday 23rd September 2015 
Today the much anticipated speech by the European Central Bank (ECB) president Mario Draghi has caused the Euro to gain strength, and this has pushed Pound/Euro rates down to around €1.36 which you can see from the chart below: 

What did Drahi say that caused the Pound/Euro rate to drop? 

In recent days there was speculation that the ECB may either increase their Quantitative Easing programme, or announce a cut in interest rates in order to combat a potential slowing of the Eurozone economy. The market had been partially pricing this into the value of the Euro over the last few days, which is why the Pound/Euro rate had recently hit nearly €1.39. 

For me there was one key part of his speech that caused the Euro to strengthen, pushing exchange rates lower: 

“I am aware that many of you closely scrutinise the potential effect of the low interest rate environment on financial stability; ... let me underline that we are closely monitoring risks to financial stability, but we do not see them materialising for the moment. Should this be the case, macroprudential policy – not monetary policy – would be the tool of choice to address these risks.” 

What on earth does this mean, I hear you ask?! 

In simple terms, he’s saying that he knows everyone was hanging on his words to do with interest rates, but actually if the economy suffers they wouldn’t use interest rates (monetary policy) to maintain financial stability, but rather macroprudential policy (Regulating things like how much you can borrow on mortgages) instead. So in effect he’s saying that there is no chance of an interest rate cut. 

As such the Euro has gained strength and become more expensive to purchase, as I said would be the case in yesterday’s post should there be a lack of any mention of further QE or a rate cut. 

Do you need to exchange currency? 

I don’t just provide a commentary on what moves the exchange rate. I am also the Foreign Exchange manager for one of the UK’s leading currency brokerages. As such, I can help you achieve much better rates than your bank or existing broker may be offering you. 

If you need the best exchange rates, then get in touch with me for a quote for free by clicking here. I can discuss your requirement, explain what is affecting the exchange rate, and help you to make an informed decision on when to fix a rate, and of course provide you a quote to see just how much you could save. 

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Pound/Euro rises on ECB comments

Thursday 3rd September 2015
After falling 9 cents in the last month, Sterling/Euro rates have staged a slight recovery today, pushing back above €1.37 as you can see from the chart below: 

ECB cuts inflation and growth forecasts 

The reason for the rise in rates wasn’t anything to do with the Pound, but rather the Euro weakening and becoming cheaper to buy. This was because the European Central Bank (ECB) has cut its inflation and growth forecasts for the next few years. 

They said that inflation in the Eurozone would probably be very low indeed for years to come and in turn this means that economic growth is unlikely to increase as much as had been thought. The banks president Mario Draghi said it expected inflation to be 0.1% for 2015, rising to 1.5% in 2016 and 1.7% in 2017, dampened by lower energy prices. They also hinted that further Quantitative Easing (QE) may be requried to shore up the economy. QE effectively creates new money to pump into an economy and usually weakens a currency as more of it is in circulation. 

The Euro dropped like a stone on these comments and because all of this means that the EU recovery is not quite as on track as analysts and investors had thought, the result has been a sell-off in the single currency, causing it to weaken and push exchange rates back up to €1.37. 

Do you need to buy or sell Euros at the best rate? 

A typical purchase of €250,000 to buy a property abroad has differed in cost by over £11,500.00 in the last month alone, which really illustrates how important it is to get your timing right when fixing your rate of exchange. If you need to convert currency and would like to discuss the market and ways to protect you against market fluctuations, I am happy to speak to any potential clients that would like a quotation to compare what I can offer with their bank or existing currency broker. On average the rates I can provide are 2 to 3% better than available elsewhere which can mean huge savings when converting a large sum.

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Which way could Pound/Euro rates go September 2015?

Tuesday 1st September 2015 
Good morning and welcome back to my regular currency updates after the Bank Holiday weekend. While here in the UK it was dismal weather, heavy traffic and only the lack of a James Bond movie to complete the typical August Bank holiday hat-trick, over in Europe it was business as usual and markets were open. 

Numbers released yesterday and again this morning from Europe were better than expected, with both Strong German Retail Sales and a better than expected EU inflation numbers giving the Euro a boost. This has pushed exchange rates lower. This morning we saw the Euro gain further strength due to better than forecast EU jobs numbers. 

The Euro has been getting stronger and stronger recently, as those with an eye on the GBP/EUR rate will have noticed. In the last month the rate has plummeted by over 8 cents, seriously affecting those trying to budget for a Euro purchase. As I outlined in a recent post, the reason for the decline is two-fold. Firstly we have the Pound weakening off due to the expectation of a UK interest rate hike being pushed back. The second reason is a stronger Euro due to a resolution of the Greek debt crisis and a resurgent EU economy that now seems to be growing at a steady pace, with the help from the ECB Stimulus seemingly having the desired effect. 

I do think that rates will eventually recover to €1.40 again, but this is now a medium to long term forecast. In the coming weeks and months, if we continue to see strong economic figures from Europe then the single currency could continue to become more expensive. 

Below I’ve listed what I think could affect exchange rates for the coming months. If you have a currency transaction to perform and would like to discuss what rates I can offer you, then click here to send a free enquiry today. 

What could affect exchange rates in the first week of September? 

There are various things that change exchange rates, for example: Economic data, Political Uncertainty, Natural Disasters and acts of war. The first of these is the only one that is forecast in advance, and below are the main scheduled releases for the week ahead that I think could affect exchange rates. 

If you would like to have a more detailed chat about how the exchange rate you’re interested in could change in the coming weeks or months, then click here to send me a message and I will be happy to answer any questions you may have about timing your currency purchase. 

Monday 31st August 2015 – Yesterday we saw a raft of positive data from Europe, including strong German Retail Sales and higher than expected inflation data. This has pushed GBP/EUR exchange rates lower as the single currency gained in strength. 

Tuesday 1st September 2015 – More positive data was released from Europe this morning showing that German and Italian unemployment was better than expected. This pulled GBP/EUR down from €1.37 to €1.3560. UK data this morning included mortgage approvals that were better than expected, and credit and PMI numbers that were worse. Later today we will see Canadian GDP figures that could affect GBP/CAD rates, and US Manufacturing and Construction data that might change GBP/USD exchange rates. 

Wednesday 2nd September 2015 – We start the day with Australian GDP figure. Later in the morning we see UK Construction figures, and EU wide inflation numbers. Recent EU data has been good and if this continues to be the case, expect GBP/EUR to drop further. In the afternoon, US Employment data, Non-Farm Productivity and Factory orders could all affect cable. 

Thursday 3rd September 2015 – Lots from Europe today that could change GBP/EUR exchange rates, including Inflation data, and the latest ECB interest rate decision. While no change is expected, the press conference afterwards often contains hints about future policy and so could well affect the Euro. Later in the day, US manufacturing and Services PMI could affect GBP/USD. 

Friday 4th September 2015 – the G20 meeting starts today and so any surprises here could affect various currency pairs. Scheduled releases on the calendar other than this include EU GDP figures which I expect to show a monthly growth of 0.3%. In the USA it’s jobs day and the important Non-Farm Payroll numbers. Regular readers will know that this release is very difficult to forecast. The current expectation is for 220,000 new jobs to have been created. Any more than this, then expect GBP/USD to drop, and vice versa.

Want to talk about which way exchange rates may go, and get a quote for your currency exchange?

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Pound/Euro forecasted to hit €1.54. Or €1.12. Who's right?

Friday 21st November 2014 
The Euro has weakened again today, pushing the Pound/Euro rate up from €1.25 to €1.26, marking the end of a topsy-turvy week in which was saw GBP/EUR climb 2 cents, recovering half of last week’s losses. In today's post, I'll explain the jump in the rate, and also have a look at a forecast that Pound/Euro will hit €1.54. Or €1.12, depending who you believe. Let's start with today's movements :

Why has the Pound/Euro rate gone up?

It’s nothing to do with Sterling, and all to do with the Euro. This morning the ECB president gave a speech and his comments caused the Euro to weaken and become cheaper to buy. So what exactly did he say? 

“We will do what we must to raise inflation and inflation expectations as fast as possible, as our price-stability mandate requires,” adding that some inflation expectations “have been declining to levels that I would deem excessively low,”. 

With the next ECB policy meeting only a few weeks from now, and the EU economy facing a period of stagnation, he may make further comments that show the markets that he is committed to reigniting growth and inflation. 

This is a clear signal that the ECB may embark on unconventional methods such as Quantitative Easing to help the economy. This caused the Euro to weaken and that’s the reason for today’s upward swing.

Will the Pound go up or down against the Euro ?

So what next for Pound/Euro rates? In the last few weeks we’ve seen the currency pair trading in a range from €1.24 to €1.28, and currently we’re slap bang in the middle of that range. I personally can’t see it going too much higher, but just to illustrate that nobody can predict the way exchange rates can move, consider these two differing forecasts...
 
The Pound is to climb relentlessly against the euro over the next three years and will reach levels last seen at the turn of the century, according to new forecasts by Goldman Sachs. They are predicting that rates will reach €1.54 within a few years. I find that hard to believe! In the 10 years I have been working as a Currency Broker, I have seen highs of €1.55 and lows of €1.01, but the current level of a little under €1.30 is a more realistic value in my opinion. Moreover, such a dramatic rise in sterling cannot easily be justified by the underlying weakness of the British economy, which already has the worst current account deficit in the developed world. It was running at 5.2pc of GDP in the second quarter. 

The IMF have a totally different view, stating that they think the Pound is up to 10% overvalued, which could mean a correction in the GBP/EUR rate down to €1.12. Again I think such a drop is highly unlikely. 

So Pound/Euro could rise to €1.54. Or fall to €1.12. Clear as mud. 

What the two differing forecasts show is the total uncertainty over which way the rate will move into next year. So whether you are buying Euros, or have Euros to convert back to Pounds, it’s understandably very difficult to know when to fix a rate, given nobody really has any clear idea about the direction the currency pair will take. 

That’s where I can help you. While predicting the market is impossible, having a good currency broker with a sound knowledge of the markets can save you thousands of Pounds. Part of this is arming yourself with the knowledge to make an informed choice on when to fix a rate. The other part is using tools to your advantage, such as Forward contracts, Stop Loss and Limit Orders to make sure you don't lose out unnecessarily. In this way you can employ a sound strategy with regards to when to convert your funds, and take some control over what is a very unpredictable currency market.

The worst thing you can do is just sit back and hope the exchange rate moves in your favour. Hope is not a reliable economic tool. If you need to convert currency, perhaps for buying or selling property abroad or for business purposes, then get in touch with me today for a free consultation on how I can help you. A can discuss your requirement, discuss the currency pair you are converting, and explain the different options you can consider to help you make the most of your currency. When you decide to fix a rate, I can source you an exchange rate up to 5% better than banks and other brokers. 

Click here to send me a free no obligation enquiry today.

Pound/Euro forecast between €1.24 and €1.27

Tuesday 21st October 2014 
In the week since my last post, we have seen significant volatility in Pound/Euro rates. As you can see from the chart below, we have seen highs touching €1.27, and lows or nearly €1.24: 

 

What is causing the volatility in GBP/EUR rates? 

The movements in the exchange rate over the last week have been very large indeed. In the last 7 days alone, the cost of buying a €250,000.00 property has differed by nearly £5000.00 purely due to fluctuations in the exchange rate. This clearly illustrates how important your timing is, in addition to having a good knowledge of what can move the exchange rate. 

The Pound fell last week on data and comments from the Bank of England, which suggest that interest rates are going to remain low for up to a year. This has taken the wind out of the Pound’s sales and caused exchange rates to drop. 

The fall was short lived however, as data from the Eurozone doesn’t exactly inspire confidence. Various EU economies are not performing very well, and this has weakened the Euro helping the rate to recover. 

Will Pound/Euro rates go up or down in the next 6 months? 

I personally think that the Pound’s strong run has come to an end and all the good news surrounding the UK economy is now largely priced into the rate. The only thing I can see that would cause rates to rise would be a further deterioration of the EU economy. 

Indeed I think it’s likely the European Central Bank will have to create money to pump in to the economy, which taken on its own could weaken the Euro and push rates up. 

What’s hard to quantify however, is what the knock on effect of an EU slowdown would have on the wider global economy, particularly the UK. The EU is our largest trading partner and as Europe slows, our growth is also at risk. So a weakening of the Pound could also be a result of a weakening in the Eurozone. 

In the short term, tomorrow’s Bank of England minutes showing how keen they are for an interest rate hike is the main event this week that will affect Sterling exchange rates. 

Get in touch to find out how to get the best exchange rates 

When you need to buy or sell currency, to buy property abroad for example, the exchange rate can make a huge difference to the cost. 

Getting the best exchange rates is paramount, as is timing your purchase. Often a property purchase or sale can take several months to complete, during which time your return could be severely affected by changes in the exchange rate. 

If you need to buy or sell currency for any reason then it’s worth getting in touch with me to discuss your requirements. I can provide you a quote for you to compare with your bank or existing broker. I can also explain what is happening to the exchange rate including helping you decide when to fix a rate. Also, I have various tools and contract types to protect you against the market moving against you, and ensure you don’t get a worse rate than is necessary. 

It’s free to make an enquiry, doesn’t obligate you in any way, and like thousands of clients that have contacted me through my blog, you could save thousands of pounds. 

Click here to send me a free enquiry now.

Pound drops from new highs after Bank of England minutes

Wednesday 23rd July 2014 
Since my last post on Monday, the Pound/Euro rate had been slowly creeping up until today, due to weakness in the Euro. In fact this morning rates touched a new high of €1.27, but as has been the case of late the gains were not to last… 

Bank of England minutes causes Pound to fall 

This morning at 09:30am the Bank of England released its recent minutes showing what was discussed and how they voted when interest rates were recently kept on hold. As you can see from the chart below, GBP/EUR edged up to €1.27 just before the announcement. This was because there might have been some of the 9 member committee that had voted for rates to rise. 

 
As it happened, all 9 members voted to keep rates on hold, signalling that rates are likely to remain at 0.5% for some time to come. Even though unemployment is dropping and the economy is growing, I think rates will not go up anytime soon until wage growth catches up. If they raise rates too quickly it could destabilise the recovery. You can read a detailed report on what happened today here on the BBC website.

Will Pound go up or down against Euro?

For the reasons outlined above, I can’t see the Pound gaining much more strength in the short term, so those that are looking for the best exchange rates should consider fixing now while it’s so favourable. By holding out hoping for more gains, you will probably find there is more to lose than there is to gain. 

For those converting currency back to Sterling, get in touch for a free consultation on your options. The Pound will get stronger eventually as we get closer to a rate rise, but there are ways to protect against the market moving against you such as Forward contracts, Stop and Limit orders. 

To find out more about the excellent exchange rates I offer, the contract types available, or simply to have a chat about which way the currency markets are going then click below to send me a free enquiry today. 

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Pound hits 20 month high of €1.25 after interest rate rise hint

Friday 13th June 2014 
Good morning. Friday the 13th, unlucky for some, but not those that need to move Pounds to Euros. Sterling has surged higher following a speech by the governor of the Bank of England Mark Carney, in which he has signalled that interest rates may rise this year. I’ll go into a little more detail in a moment, but in a nutshell this has caused Sterling to rise higher, hitting a 20 month high of €1.25 against the Euro, and testing a 5 year high of $1.70 against the US Dollar: 

Mark Carney hints at interest rate rise 

Last night in a keynote speech, Mr Carney said a rate rise "could happen sooner than markets currently expect". He acknowledged there was "already great speculation about the exact timing of the first rate hike" from their record low of 0.5%, adding that the decision was "becoming more balanced". 

The news immediately caused the Pound to gain, as the rumour of higher interest rates attracts investment into the Pound, giving it strength and causing exchange rates to rise. 

Will the Pound go up or down against the Euro?

Nobody knows which way the exchange rate will go, but in general the markets move more on rumour than fact. This means that the rumour of higher rates is now getting priced into the market, hence the current excellent buying level for Euros. 

In my view, from what we know right now it’s likely the Pound will remain strong, and the Euro will remain weak, so we could well see rates go higher. However there are situations that could cause it to fall back away, so you should be aware of these if you need to buy Euros and are holding out for a higher rate. 

In his speech he also described the perils ahead for the economy. He said he would look to his ‘trusty canoe’ to ‘navigate the most rapid and treacherous waters’. These include: 

• A housing market which could ‘overheat’ 
• High levels of household debt and a record current account deficit. 
• He warned the UK economy is ‘currently unbalanced internally and externally’, adding this had to be addressed to turn the recovery into a ‘durable expansion’. 
• Carney also pointed to ‘old imbalances persisting and new ones emerging.’ 

So there are lots of warnings that the economic recovery is not guaranteed to continue, and so there is the risk the Pound could drop back away. We also have the Eurozone that is taking significant steps to bolster their economy, and if these measures work the Euro could gain strength pulling rates back down. 

What should you do if you need to buy or sell foreign currency at the best rates? 

Your first step should be a free consultation, which I can provide over the phone with no obligation. I can discuss your particular requirements, explain the various tools you can use to protect against the market moving against you, and provide you a quote to compare with your bank or existing broker. 

I can provide rates up to 5% better than available elsewhere, on up to 25 different international currencies, and the savings can be considerable. 

Make a free no obligation enquiry with me now by clicking here. 

Alastair Archbold

Will Pound/Euro rates go up or down June 2014?

Friday 30th May 2014 
Good morning. Exchange rates remain quite steady today. Pound/Euro rates have dropped a little this morning after some very impressive German Retail Sales numbers. This strengthened the Euro and made it more expensive, pushing GBP/EUR down into the €1.22’s. Pound/Dollar rates remain a little above $1.6730. 

Will Pound/Euro rates go up or down June 2014? 

As regular readers of my blog will now, the current high GBP/EUR rate is all to do with interest rates. The markets expect the UK to raise interest rates, and this has been gradually priced into the market over the last few months, resulting in the highest Pound/Euro rates in 18 months. 

Over in Europe, the threat of deflation means that the European Central Bank (ECB) may have to cut interest rates. Next Thursday we will find out as they announce their decision. I think there is a very good chance they will cut to around 0.1%. If they do, then Pound/Euro could go higher. However should they choose to wait, then we will probably see the exchange rate drop sharply. 

After their decision they will give a press conference which will give an insight into their discussions. All in all, this is a very very important week for the Pound/Euro cross. (See below for other economic information that could affect the rate. 

What should you do if you need to buy or sell Euros at the best exchange rate? 

Perhaps you need to convert Sterling to Euros, or maybe you have Euros to convert to Pounds. Whatever your requirements, this week is an important one and will have an effect on the exchange rate you can achieve. 

Why not take the opportunity for a free consultation on the service I offer. I can explain what the market is doing, which way the rate could go, and run over the options you can look at to protect against the rate moving against you. My service is free, and I can also provide you a quote to compare with your bank or existing broker. You could be surprised how much you could save. 

Click here to send me a free no obligation enquiry now. 

Next week’s data that may affect exchange rates this week. 

As regular readers of my blog will know, the main thing that causes exchange rates to move is economic data releases. Below I have listed the main economic data that I think could affect currency rates this week. 

Monday 2nd June 2014 

The Manufacturing PMI (Purchasing Managers Index) is the main thing on the menu today. This captures business conditions in the manufacturing sector, and as a very important indicator of overall economic conditions. This is released today by the UK, EU, Germany, and the USA so expect some volatility for Pound/Euro and Pound/Dollar. 

Tuesday 3rd June 2014 

Nothing of note from the UK today Over in Australia we have Retail Sales numbers and an interest rate decision from the Reserve Bank of Australia (RBA). The main driver for GBP/EUR rates will be the Unemployment numbers and inflation data from Europe. 

Wednesday 4th June 2014 

GDP numbers are released from Australia today which could affect GBP/AUD rates. We also have GDP numbers from Europe, along with inflation data. Further afield we have Trade Balance numbers from the states, and an interest rate decision from Canada. 

Thursday 5th June 2014 

The most important day of the week for GBP/EUR rates. The Bank of England (BoE) announces its Quantitative Easing (QE) and Interest rate decision today. I don’t expect them to make any changes. However, we also have the European Central Bank (ECB) decision, and there is a good chance they could cut interest rates. 

The market has already partially priced this in, but if they do cut the Euro could weaken and push GBP/EUR higher. If they don’t cut, Pound/Euro rates will probably drop. They will also give a press conference after the decision which could also have an impact on rates. 

Friday 6th June 2014 

Trade balance figures from the UK this morning could create some volatility for Sterling. There are also Trade Balance numbers from Germany. Over in the states, the main event will be the Unemployment figures and non-farm payroll numbers. Regular readers will know this release often has quite a big impact on the Pound/Dollar rate. 

Looking for the best exchange rates? Make a free enquiry. 

Pound/Euro rates could change tomorrow...

Wednesday 2nd April 2014 
We have seen Sterling rise against the Euro today, getting pretty close to the €1.21 level. We’re unchanged against the US Dollar which remains just above $1.66. 

I think that tomorrow is going to be a key day for Pound/Euro exchange rates, due to the ECB meeting that will give investors an idea whether they are going to take action to combat deflation. Today I will explain what tomorrow’s meeting means for those that need to buy or sell Euros at the best exchange rates. 

It will be a very important day for those of you that need to buy or sell Euros in the coming months. Read on to find out how tomorrow could affect currency exchange rates, and if you would like to discuss your requirement with me in detail, get in touch with me today. 

I can help you achieve exchange rates up to 5% better than banks or other brokers, so get in touch for a quote. It costs you nothing, and you could be very surprised how much you could save by using my services. 

European Central Bank (ECB) meeting may affect GBP/EUR 

The ECB really do hold the key to which way the Pound/Euro rate will move in the coming weeks and months, and it’s all to do with interest rates and inflation. First, a bit of context. In the UK our interest rate is 0.5%, and as the economy recovers the Bank of England (BoE) will start to raise rates, probably around this time next year. That’s what has been keeping the Pound strong, because higher interest rates strengthen a currency due to the higher return. 

In contrast, the Eurozone inflation levels keep dropping, and many analysts have been calling for them to cut interest rates. This is also helping GBP/EUR stay high, as lower interest rates are keeping the Euro weak, and a weaker currency is cheaper to buy. 

So, on to the meeting tomorrow. At 12:45pm they will announce interest rates. I don’t expect any change to their rate. At 13:30pm the president Mario Draghi gives a press conference, and it’s what he says here that we’re interested in. 

What could Mario Draghi say that could affect Sterling/Euro exchange rates? 

There are 2 scenarios, each of which is likely to affect the exchange rate you get. Firstly, he may say that due to deflation worries, they may have to take some easing measures in the future such as cutting interest rates, or doing a Quantitative Easing style programme similar to what we saw in the UK. If he hints at either of these things, the Euro will weaken and Pound/Euro rates could rise nicely. 

Alternatively, he repeat what he’s said in recent meetings, which was that deflation will sort itself out on its own, and therefore no action is necessary. In this scenario, Pound/Euro rates could plummet well below the €1.20 level again. 

What do I think will happen? 

I think they will hint at some sort of easing. The market thinks this too, and that’s why GBP/EUR has risen today as this gets priced into the market. I will of course update the blog tomorrow with a full outline of what happens and how it affects exchange rates. 

What should you do if you need to buy or sell Euros? 

Tomorrow could well affect the rate one way or the other, and there’s no way to predict which way it will go. If I need to buy or sell Euros, I would not want to risk the rate moving against me. 

I would therefore hedge my bets by converting half of my funds before tomorrow’s announcement, and then wait and see what the market does before converting the rest. 

This removes 50% of your exposure and give you some protection against adverse exchange rate movements. 

Find out more about the rates and service I offer 

If you have a currency transaction to perform and would like to find out how I can help you, get in touch in the following ways:

Click here to send a free enquiry 
Call me directly: +44 (0) 1442 892 066 

Ask for Alastair Archbold, and quote ref ‘FERF’

Pound/Euro exchange rate forecast 2014

Wednesday 26th February 2014 
The Pound remains quite well supported against other major currencies, however continues to fail to push any higher. This is due to the fact UK interest rates won't be rising any time soon, and also a resurgent EU economy. If EU growth continues to gain ground, we could see the Euro start to strengthen and become more expensive to buy, which could push Pound/Euro lower again. 

For those with Sterling to convert, we are currently still close to a 1 year high against the Euro, and a 5 year high against the US Dollar. 

Yesterday figures published by the British Bankers' Association (BBA) that measure the number of home loans issued were better than expected, supporting the Pound at close to 5 year highs on a trade weighted basis (mortgage approvals are seen as a leading indicator of the UK economy). 

What could affect exchange rates for the rest of this week? 

Tomorrow (Thursday) we have some key data from the Eurozone, and as the recovery in the EU is starting to quicken, better than expected figures could cause the Euro to strengthen and GBP/EUR rates to dip. The data includes German unemployment & inflation data, EU wide Economic and Industrial confidence measures. 

Friday could be a key day for where Sterling moves in the coming weeks. The only actual economic release is a measure of consumer confidence. However at 15:30pm we have a speech by the Bank of England governor Mark Carney. 

There are some further inflation and unemployment figures due from the EU at 10am. Again this could affect GBP/EUR rates depending if the figures are better or worse than forecast. 

Also on Friday there are lots of economic figures from the United States that could affect Pound/US Dollar rates. We see Gross Domestic Product (GDP) figures, Consumer Sentiment, and a measure of Home Sales. 

Click here to discuss how economic data could affect your exchange rate. 

Will Mark Carney try to weaken the Pound?

Much of the Pound’s strength of late can be attributed to the fact the economy is performing well, and many think interest rates will rise next year – this has been keeping Sterling strong. It will be interesting to see what the BoE governor Mark Carney has to say in his speech on Friday afternoon, and if he mentions the subject of interest rates. 

Put simply, if his comments support the view of an interest rate hike in the next 12 months, the Pound may rise. If however his comments are seen as negative for Sterling – e.g. he hints that a rate hike is some way off – we could see the Pound drop away. 

In my view there is a real risk of this happening, because we have already seen the Bank of England have already warned that they do not want a strong pound due to the fact it will hurt our exports and therefore the UK’s economic recovery. So Carney may take this opportunity to talk the Pound lower. 

Should you buy Euros now or wait to see if rates improve? 

There is unfortunately no way to predict if rates will rise or fall, however there are ways to protect against things getting worse for you. If you need to buy Euros, then the current rate is close to the best in 12 months, and has failed to get any higher in the last few months. 

We could see the rate increase further; however any doubt over the UK’s economic recovery could quickly mean we see rates drop again. If you need to buy Euros throughout 2014, then a good strategy is either a Forward contract or a Stop Loss Order. 

A Forward contract allows you to fix the current exchange rate for up to 12 months into the future, but you only lodge 10% of the total you want to convert. The remaining 90% you send when you want your Euros to be transferred. This is a good way to protect against the rate dropping, removes all risk from your transaction and allows you to budget effectively. It does not however let you take advantage of any gains should we see rates go higher. 

If you want to risk holding out for an improvement, then it is wise to place a ‘Stop Loss’ order. This sets a lower limit, and if the rate drops below this we automatically buy your currency for you. In this way you can still take advantage of any gains, however you also have a ‘worst case scenario’ or safety net, so that if we see a sudden drop you don’t lose out more than necessary. 

Click here to find out more about Forwards/Stop Loss orders

Would you like to achieve the best exchange rates? 

I can offer exchange rates very close to the ‘mid-market’ rate you see published on this site, which is up to 5% better than your bank can offer you. In addition to exceptional rates of exchange, I can provide a consultative service which allows you to discuss your requirement with me over the phone. In this way you can discover all the options available to you such as Forward contracts and Stop Loss orders, and make an informed choice with regards to when to fix your exchange rate. 

Getting in touch costs you nothing, doesn’t obligate you in any way, and the savings you make could be very considerable indeed. 

Click here to make a free enquiry with me today. 

Alastair Archbold

Sterling hits €1.21 but falls back away....

Monday 2nd December 2013 
Good afternoon. Well in my post late on Friday I highlighted the spike in Pound/Euro rates. This actually continued over the weekend, and when I arrived on the trading floor at 08:00am this morning mid-market levels were at an astonishing €1.2100, which is a remarkable run for this currency pair. The question is, will it last...?

Pound/Euro sustained above €1.20, for now...

As you can see from the chart showing todays movements, the market opened at €1.21. The levels were not to be sustained for long however, and throughout the day we saw the Pounds gains becoming eroded, and exchange rates have slipped away throughout the day. 

 

The market is still above the €1.20 mark however. The fact it has broken through this level has surprised many in the market, myself included, who did not expect rates to break €1.20 this year. I did however state in a recent post  that while I didn’t expect it to break through €1.20, if it did it would likely continue rising significantly above it, and that’s what we have seen happen.

What will happen moving forwards depends on this week’s economic data releases. Now levels are above €1.20 I expect them to be supported at that level, unless we get any suprises with the week's economic data.

In today’s post I’ll simply give a brief outline of different strategies you can consider if you are converting foreign currency and need the best rates. In tomorrow’s post, I’ll list the week’s economic data releases that I think will affect exchange rates this week. 

Click here to have a free consultation for your requirement.  

Do you need to buy Euros at the best rates? 

Rates are very good indeed, and the best they’ve been since January; however seem to rise before dropping back away.

If I needed Euros I would place a Stop Loss order to fix a rate should it drop below a pre-agreed level. This means if rates continue to rise you can still take advantage of further gains, but not risk losing out on the 5% gain in rates we have seen in recent months. 


Click here to get a Pound/Euro quote

Perhaps you want to maximise a Euro to Pound transfer?

Rates have been steadily moving against you. It’s impossible to predict where things will go, so in the current climate a Stop Loss again is a very useful tool. 

This fixes your rate if it gets worse than a pre-agreed rate that you can decide, giving you some control over currency markets which are very volatile. 

I can also source Limit Orders, Forward Contracts, and Spot contracts at rates significantly better than banks and other financial institutions. 

Click here to get quote for selling Euros

Other Currencies 

Sterling is currently at the best level in many years against lots of major currencies, including the US Dollar, Euro, and also the antipodean currencies such as the Australian Dollar and New Zealand Dollar. 

If you are looking for the best exchange rates for any major currency, or have a foreign currency you want to convert back to Sterling, then I can help you. 

In addition to the rates I can source that are up to 5% better than the banks, I have extensive knowledge of the currency markets, and various contract types that can protect you against rates moving the wrong way, and help you to budget. Very useful if you are buying or selling property abroad, or buy and sell goods in the Eurozone for example. 

Click here to send me a free no obligation enquiry today. 

I look forward to hearing from you.

Alastair Archbold

Pound/Euro exchange rate forecast Feb 2013

Wednesday 6th February 2013

Good afternoon everybody. As usual today I'm posting up a quick mid week update on what has been happening with exchange rates, and the Pound/Euro rate in particular. As regular readers will know, Sterling/Euro has been in sharp decline over the last few weeks, however we have seen things steady a little over the last few days. Read on for more on what the predictions and forecast is for Sterling/Euro exchange rates over the next few weeks. 

Well let's get started then. To kick off, I'm going to take a retrospective look at what has happened this week, before moving on to where rates are headed. 

Pound steadies against Euro

On Friday, we saw rates fall as low as 1.1475, the lowest in around 16 months. this was after a particularly sharp decline in rates on Friday, reminding us all the exchange rates can often move very quickly and without warning. 

On Monday the Pound recovered nearly all its losses and rose back up to around €1.16. There was no particular reason for the rise - indeed we actually had poor inflation data from the UK. I think the main reason was simply a slight correction following the dramatic decline in previous days.

Tuesday saw the downward trend continue yet again, dashing any hopes amongst Euro buyers that a recovery was on the cards. We had cold water poured on the growth forecasts for the UK, this pushed rates down again to around 1.15.

Today, rates are on the up again, demonstrating what a yo-yo the GBP/EUR cross is, meaning it's impossible to predict where it will go - day to day it's fluctuating up and down by 1% or more. We've had some better than expected Retail Sales, and also signs the service sector is improving, which is part of the reason for rates climbing back a little. We're still way off the €1.23 of a month ago, and at the time of writing rates remains steady a little under €1.16.

Worried about rates? Have a free consultation now, click here.

So will rates continue to climb, or will they fall?

This of course is what everybody wants to know, but in reality nobody can predict which way rates will move. Instead I will now outline the arguments for both rates climbing and falling, and then you can make your own mind up on what you think will happen. I'll give my opinion after the summary. 

The case for rates continuing to fall
 
UK borrowing is likely to be £64bn higher in 2014-15 than forecast in 2010, according to a closely watched report. The Institute for Fiscal Studies (IFS) says a weak economy will mean the government has to borrow more than it forecast, unless it imposes tax rises and further spending cuts. 

We also have real fears the UK is heading back into recession which in turn means more Quantitative Easing is on the cards along with a downgrading of our credit rating. If the economy continues to disappoint, GBP/EUR could continue to fall towards €1.10.

The case for rates going back up

The weakness in Sterling is partly due to the fears of recession being priced in to the value of the Pound already. 

If figures later this year show growth, it could give the Pound a boost. 

Also the Euro is very strong at the moment, should they decide to 'talk the Euro down' in order to make it's exports cheaper, this would weaken the Euro.

What do I think?

Personally I think there is much more chance of rates continuing to fall than suddenly get back to €1.20. I believe there will be more negative GDP figures, further Quantitative Easing, and all the while most global investors are now much more confident on the Euro, giving it strength. 

In the short to medium term, I think the Pound will continue to struggle against the Euro, but in the latter part of the year would expect to see a modest recovery towards 1.20. 

To discuss things in more detail, send me a free enquiry. 

What to watch out for in the next few days. 

If you are buying or selling Euros in the coming days, then there is some important events you should watch our for. 

On Thursday at 12:00pm and 12:45pm respectively, we have the latest decision from the Bank of England and European Central bank on interest rates. I don't expect any change in rates from either bank, but there is a small chance of more Quantitative Easing from the Bank of England. Should this be the case, expect the Pound to drop against other currencies by some margin.

Also tomorrow, we have UK Trade Balance and Manufacturing/Industrial production figures. Poor numbers here would really weaken the Pound and could mean a further decline in the rate. 

Also on Thursday at 3pm, we have a GDP estimate, which will include the figure for January. This will give us some idea whether the UK is heading back towards recession, so the currency markets could be very choppy tomorrow. 

Send me an enquiry to find out more about how this data could affect your currency requirement. 

Making the most of your currency

Regardless whether you are buying or selling a foreign currency, having a good broker that can keep you up to date with events in the markets is very important. In addition to my expert market knowledge, the rates I can source are significantly better than available at banks and other financial institutions, sometimes by as much as 5%. 

So if you are worried about which way rates are going, send me a free enquiry now. I can spend 5 minutes discussing your requirements, running over your options, and explain how our service works. I look forward to hearing from you.

Click here to send me a free enquiry

Will the Pound keep falling against the Euro?

Monday 4th February 2013

Good morning. Well readers, I'm sorry to say I do not bear good news for anyone needing to purchase Euros in the near future. Rates last week continued their decline falling significantly. A month ago rates were at 1.23 - on Friday afternoon they were as low as 1.1475 - this was the biggest one day fall for the Pound since 2008.

Rates have recovered slightly this morning, back to €1.1550. Today I'll review why rates are falling, and what effect data this week could have on rates.

In this week’s Report:

• Pound/Euro continues to fall to 14 month low
• US GDP figures disappoint, but GBP/USD still low
• UK decision on QE and the latest GDP estimate this week
• Round up of the week’s other data that may affect rates

Sterling vs. Euro; 

Sterling’s fortunes remained unchanged last week as it continued to fall against the single currency. Rates fell a further 2.0% over the course of the week, which now means we have seen a 7% decline since the turn of the year and at its lowest point the GBP/EUR cross hit 1.1470, the lowest we have seen the cross since October 2011. In this week’s euro report we will take a look at what caused the rates to fall and what is around the corner for the pound. 

Although there was some positive data releases out of the euro-zone last week the recent drop in rates is still mainly down to sterling weakness. In recent weeks the UK has been under the microscope and with a black cloud hanging over the UK economy it is difficult to see where any positive moves may come from. 

Ever since the Initial GDP estimate was released at the start of January sterling has been in free fall against the single currency. Even with poor French and German retail sales figures released last week, which came in much lower than forecast, the pound could not recover any of its recent losses. 

Do you need to buy Euros? Send an enquiry and find out your options.

Bank of England meet this week; more QE on the cards?

This week will see all eyes turn back to the Bank of England; policymakers will meet to discuss interest rates and quantitative easing for the first time since the official GDP figures (released on the 25th Jan) confirmed the UK economy contracted in the final quarter of 2012. 

In their last meeting policymakers voted 8-1 in favour of not adding to their existing QE programme but that could all change this week. If the BoE opt for another round of QE it leaves the door open for rates to fall even further. 

Further important figures for the UK this week

This week also sees the release of the GDP Estimate from the National Institute of Economic and Social Research (NIESR) which is an estimate of growth over the last three months (this will report will give us the first GDP estimate for Jan 2013), the report is seen as highly reliable and has the potential to influence the UK monetary policy. A negative reading could have severe consequences for the pound and will push us ever closer to the dreaded tripe dip recession. 

Let's put this in perspective

With no signs of improvement it is more important than ever to have a good currency broker on your side, and to know your options. To put this year’s move into perspective, Purchasing €250,000.00 now compared to a month ago will cost you a staggering £15,000.00 more - that's just due to the decline in Sterling's value this year. It also highlights how important timing is when it comes to move your money. 

With the seemingly perpetual decline in the GBP/EUR rate and no signs of it slowing down, now is the time to take stock of your currency requirements and consider your options. Get in touch with me today and take the time for a free consultation on what is available to you. 

Don’t simply watch the decline and hope things will move your way. Take control of your position now by sending me a free enquiry now. 

When you contact us, quote the reference 'AJABLOG'

Weekly Economic Data that may affect exchange rates 

Monday – The UK releases its latest House Price Data today. In the Eurozone we have Inflation data and a measure of investor confidence. The only other data of note are some Factory Order figures from the United States. 

Tuesday – Lots of measures of inflation are released today for the UK, Spain, Italy, France and Germany. Also in the Eurozone we see the latest Retail Sales figures, which are a good barometer of overall economic activity. Fairly quiet stateside today with Manufacturing PMI the only noteworthy release. 

Wednesday – Nothing of note for the UK today, and the Eurozone is also very quiet with German Factory Orders the only release of note. Other than that, we have employment data from New Zealand that could affect the GBP/NZD rate. 

Thursday – As usual today is the busiest day of the week. We’ll start in the UK: Bank of England decision on Interest Rates and Quantitative Easing, the latest GDP estimate, Trade Balance Numbers, Industrial Production and Manufacturing Production. Eurozone: European Council Meeting, French Trade Balance, German Industrial Production and some EU growth forecasts. We also see the ECB’s decision on interest rates. So much today that will affect GBP/EUR rates. 

Friday – After yesterday’s flurry of UK data, today is very quiet. Nothing from the UK, some inflation and Trade balance figures from Germany, and we round of the week with Trade Balance numbers from the United States. 

 Getting the best exchange rates 

You want the best exchange rates, of course you do. That's why you're reading this blog to try and gauge your timing. Take the next step and send us a free enquiry and have a consultation on all the options available to you. 

It's free, it doesn't obligate you, and you may be surprised how much you can save by using us to get exchange rates that are up to 5% better than offered by banks. Click below to send your free enquiry now, and get a response the same day.  

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