Weekly Sterling/Euro forecast & predictions

Monday 16th April 2012
Good morning. Today as is usual for a Monday, I'll take a retrospective look at what happened in the currency markets last week, with a focus on the Pound/Euro exchange rate in addition to the weeks economic data I think will have an effect this week. Will the Pound/Euro rate remain above €1.20?

In this week’s Report:

• Pound remains stable against Euro
• EU Debt problems refuse to go away
• Round up of the week’s data that may affect rates

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

Sterling vs. Euro;

Last week saw the GBP/EUR rate move to a 19 month high of 1.2160, a mid-market price we haven’t seen since September 2010 and was driven by continued negative data coming out of France, Greece and Spain.













Data and events last week in the Eurozone showed that French manufacturing production declined further, only narrowly avoiding a slip into negative territory whilst social unrest continued in Greece as more strikes at the start of the holiday season seemed destined to halt efforts to get the economy moving again.

Spanish 10-year bond yields remained high, prompting investors to move to the safer heaven currencies of the GBP and USD. Also, Spain’s 10-year yield jumped to 5.99% nearing the levels that prompted Greece, Ireland and Portugal to seek bailouts.

Despite the bad news coming from the Eurozone, there seemed to be little effect on the currency markets. The negative news seems to be priced into the market already; as everyone knows it will not be a quick turnaround for the single currency. This has helped the GBP/EUR exchange rate to keep trading above the 1.21 level on interbank.

Furthermore the Pound was supported and has hit a 13 month high against a trade weighted basket of currencies. Sterling has been helped of late by data showing British retail sales rose in March at the fastest pace this year so far. Retail Sales are a good overall barometer of the UK economic as a whole, and so often have quite a big impact on the value of the Pound. The British Retail Consortium said like-for-like retail sales rose by an annual 1.3%, easily beating expectations of a stagnant performance, hopefully holding off fears of any potential recession for the UK economy.

As with the Euro data, the positive data out of the UK didn’t have much effect on rates as the markets wait to see what effects Q1 GDP figures on Wednesday (25/04) next week will have on the markets. The GDP figures will be very important indeed as they will show whether the UK is back in recession or not. Most analysts say that this is the next key indicator of the UK economy.

So will exchange rates remain above €1.20?

So in summary, the market seems to be fairly stable of late, and has been range-bound around the 1.20 and 1.21 levels for a few weeks now. Moving forwards, with forecasts for the exchange rate varying wildly between €1.14 and €1.25 for the next 3-6 months it’s very hard indeed to know what will happen.

It’s very important to note that despite the stability of late, it’s no guarantee rates will stay at this level. Indeed over the course of the last few years we have breached €1.20 several times, only for a sharp downwards correction to follow. Even if you don’t need your currency for some time, there are tools in place to protect you against adverse movement.

With much uncertainty over the issues in Europe, and of course the possible know on effects of this on the UK, the best course of action is a free consultation with us to discuss your options.

Make a free enquiry now - click here

Weekly Economic Data that may affect exchange rates

Monday – We start the week with EU Trade Balance figures, which can quite often affect the value of the Euro. UK wise, there is no data released today. Over in the United States we have Retail Sales at lunchtime, followed by Housing market prices in the afternoon.

Tuesday –This morning we have and RBA policy statement which will be interesting as there is talk of an interest rate cut down under, which could push GBP/AUD higher. In the UK we have a host of data including the Consumer Price Index (Inflation), Retail Sales and House Price Data. In Europe the German ZEW survey (confidence measures) will be released at 10am. In the US there is House Price info released at 13:30, along with industrial production figures at the same time.

Wednesday – Unemployment data is the main UK release today, including the claimant count and average earnings measures. In the EU there are Current Account measures which measure the net flow of funds in and out of the Eurozone, so expect some EUR volatility. Later in the day some inflation measures are released from New Zealand.

Thursday – Unusually for a Thursday there are no UK releases today. In the EU there are consumer confidence measures which in the absence of any other EU or UK data could have a bigger impact than normal. In the USA we have Home Sales data and the Philadelphia Manufacturing Survey.

Friday – We end the week with Retail Sales data being released from the UK, which is a good barometer of the economy as a whole. In the Eurozone there are various confidence measures from Germany, which can have a big impact as its Europe’s largest economy. Other than that the rest of the data is from Canada in the form of various measures of inflation.

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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Pound Euro rate forecast for best exchange rates

Friday 13th April 2012
Good Morning. Since my last post on Tuesday morning, markets have remained fairly flat with little happening to affect exchange rates. Indeed yesterday Sterling surged to a 19-month peak on a trade-weighted basket of currencies, highlighting the strength of the Pound at the moment.

Pound remains around the €1.21 range vs the Euro

Against the Euro, we saw rates climb initially yesterday, hitting a peak of €1.2160, which is pretty much the best we've seen in 20 months. Rates did take a slight dip however as the day progressed, falling back to the €1.21 level by the end of the day.

The main reasons for the climb early on was concerns over Spain's fiscal position, and this weakened the single currency slightly.

UK Exports fall, worrying UK policy makers

The UK's trade deficit widened in February as exports of goods to non-EU countries dropped, figures have shown. The deficit on the trade in goods and services increased to £3.4bn from a revised £2.5bn in January, the Office for National Statistics (ONS) said. Due to this, we saw the GBP/EUR currency pair steadily fall back to where they were earlier in the week.

"The sterling move right now, in their heart of hearts, they (the BoE) would probably prefer not to happen," said Simon Derrick, head of currency research at Bank of New York Mellon.

This is because throughout the financial crisis, policymakers in the UK have been trying to re balance the UK economy through higher exports, especially as domestic demand remains soft amid fiscal tightening and rising unemployment. So, the hope was that increased exports to the EU would help the UK economy grow again.

The reason for the fall is two fold, firstly exports of goods to non-EU countries dropped due to the well publicised debt problems surrounding some EU countries. Also, the general strength of the Pound of late has not helped. While a strong Pound is great for those needing to buy foreign currency, it's bad news for anybody needing to convert foreign currencies into Sterling, as the Pound has now become more expensive to purchase.

So will the Pound now continue to gain against the Euro?

If UK figures continue to surprise to the upside, then it could continue to rise, however we have actually seen rates remain fairly flat, which suggests to me that we may well have already hit the peak with the Pound struggling to make any further substantial gains.

It should also be noted that the UK is exposed to the EU debt crisis, partly because we are a large trading partner, and partly due to the fact our banks are exposed to a very large portion of the debt. For this reason, while the EU problems keep the Euro weak, they also could start to pull the Pound down also.

Pound gains against weaker Dollar

We saw Sterling gain through most of the day against the US Dollar, but again the trend was not to continue. Jobless Claims and annual inflation data was worse than expected, weakening the USD and making it cheaper to purchase and as a result, exchange rates went up.

Later in the day however, we saw much better than expected Trade Balance data, in addition to further inflation data that beat forecast. This was an excellent example of how data that is different than forecast can affect exchange rates.

Economic data releases are always forecast ahead of time, and these forecasts dictate market prices as they are priced in to exchange rates. Therefore when data comes in as forecast, regardless of whether it is good or bad news, it generally doesn't have a huge effect on rates. Yesterday however you can see the effect the worse than expected figures had when exchange rates rose, and then the opposite happened when the surprisingly good Trade balance figures were released.

This is why it is important to keep abreast of upcoming data releases as they often have quite a big impact on exchange rates.

Today's Data

There are quite a few releases today. For the UK we have a host of varying inflation data released at 09:30am. As explained above, if the figures are different to forecast it could affect Sterling exchange rates.

We also have similar inflation data from Germany and the US, so lots that could affect GBP/EUR rates and GBP/USD rates.


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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Weekly Sterling/Euro forecast & predictions

Tuesday 10th April 2012
Good morning. I hope everybody enjoyed the Bank Holiday weekend. In today's report I'll take stock of the huge gains seen in GBP/EUR rates last week, and how to take advantage of them even if your requirement is some way off.

In this week’s Report:

• Pound/Euro rates surge into the €1.21’s
• Best way to fix the record Euro rate for the future
• Round up of the week’s data that may affect rates

Sterling vs. Euro;

After the previous week’s constant bad news about the UK economy we would have been led to believe that the national papers had their printers on standby, ready to run off huge spreads about the UK heading back into recession and how we were all doomed.

However last week couldn’t have started any differently with the British Chamber of Commerce contradicting the previous week’s expectations and saying that they felt the first quarter of 2012 had actually been more positive than most thought, and that the UK could avoid a “double-dip” recession.

This view set the tone for the week as we saw manufacturing, construction and service sector PMI all surprise to the upside on 3 consecutive days (Mon-Wed), and even more surprising was the Halifax house price data on Wednesday which showed house prices rising 2.2% in March, up from a drop in February. This really helped to buoy Sterling and forced the rate up from 1.1970 Monday morning to nearly 1.21 by Wednesdays close.













News out of Europe was a little different to say the least. We had confirmation that the Eurozone economy as a whole had shrunk 0.3% in the previous quarter and the data last week didn’t do much to help the Euros prospects for the future. Unemployment rose again to a new high of 10.8% while retail sales fell and German factory orders showed much lower than expected. The Euro fell against most other currencies too (2.3% against the USD) as Eurozone issues were bought back into focus on Wednesday when we saw a disappointing bond auction in Spain and further political rumblings in Greece.

Thursday saw the Pound reach a 2 ½ month high of 1.2137 against the Euro after shrugging off a surprise drop in UK factory output which showed an annual decline of 1.4 present. At lunchtime the Bank of England held the interest rate at 0.5% and didn’t announce any more Quantitative Easing as was expected. The Pound garnered further support as the National Institute of Economic and Social Research (NIESR) released its estimate for UK GDP for the last 3 months and they predicted that the economy grew at 0.1%. Such a small reading would normally be bad news but after the expectations that a technical recession in the UK was just around the corner it may actually be the first sign of further recovery.

Whatever happens over the next few weeks as we move towards the actual GDP reading, the current rate is a perfect time to forward buy currency as I can’t see the rest of the year being anything but uncertain. A Forward purchase is where you can fix a rate of exchange for up to 2 years into the future, but only need to pay a 10% deposit straight away with the balance when you need to complete on the contract.

It is a perfect budgeting tool for property purchases or stage payments, and can also be used by anyone needing to sell currency to avoid potential negative market movements.

Speak to us today about how to make the most of your currency.

Weekly Economic Data that may affect exchange rates

Monday – UK, French, German and Italian Markets are all closed yesterday for Easter. We still some released however including some UK House Prices, EU Investor confidence and Australian Business confidence figures. Trade was very thin and so there was little effect on the markets.

Tuesday – Markets worldwide resume today, and the main data for UK is the BRC Retail Sales, and UK House price data. In Europe we have Industrial Production and German Trade Balance data. Stateside we have wholesale inventories and Consumer Sentiment measures.

Wednesday – Nothing of note from the United Kingdom today. The main data is from the US including Trade Balance Data, The Fed’s budget statement and the Fed’s beige book.

Thursday – Today we see Trade balance figures from the UK. In Europe the main releases are Industrial Production and an ECB monthly bulletin. Again the USA comprises the bulk of data releases today including Jobless Claims, Trade Balance and Inflation data.

Friday – We end the week with UK Producer Price Index & US Consumer Price Index

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.

Click here to send me a free enquiry

Pound Euro rates hit €1.21 and close to 20 month high

Thursday 5th April 2012
Good morning. Why have Pound/Euro rates gone up April 2012? As is often the case, a day can make a big difference in the currency markets, and yesterday was no exception. In my most recent post I pointed out rates had dipped below €1.20, however throughout the day yesterday the GBP/EUR rate surged and touched €1.21 - this is nigh on the best rates we have seen to buy Euros for 20 months. Today I will look at the reasons why.

Pound/Euro rate forecast - surges to €1.21

The Pound gained well throughout trading yesterday, as the chart shows. Much better than forecast UK services sector survey eased UK recession fears, and they also highlighted a contrast with a struggling euro zone economy. As a result we saw Pound/Euro rates push up by 1% - a huge gain for one days trading.

A disappointing auction of Spanish government bonds also weighed on the Euro, as worries grew about Spain's high debt levels and weak economy. Europe's economic prospects look very poor indeed, and debt problems in Spain and Italy mean that the European Central bank will have to do even more to support banks and its weaker economies. This has caused significant Euro weakness and made the Euro cheaper to buy.

ECB leaves interest rates on hold, but press conference dovish

As I forecast yesterday, there was indeed no change to EU interest rates in yesterdays meeting, and also no further quantitative Easing for the UK. As these decisions were as expected it made little to no difference to exchange rates.

What did make a difference however were comments by the ECB president Mario Draghi. He said the euro zone economic outlook is subject to downside risks relating to the debt crisis and commodity prices. This was another reason for GBP/EUR rates climbing as the single currency weakened.

Getting the best exchange rates for Euros

In my opinion it's an excellent time to consider fixing a rate for buying Euros, when you consider it's sitting just below the best rates in 20 months. With UK recession fears on the horizon, it wouldn't take much to knock rates back down, and indeed that's the trend we have seen the last few times rates have been at this level.

We can now offer €1.20+ as a trading level for trades of £20k+, and very close to that for amounts of £1k+. Even if you don't need your Euros now, you can still lock the rate in now with a Forward contract. You simply lodge 10% of the total you want to convert, and we'll guarantee the current rate for up to 2 years. Certainly worth considering if you need Euros in the next 6 to 12 months, as it will protect you against rates dropping back away.

If you want the best Euro exchange rate, click here to find our more about my service.

Pound/US Dollar rates drop away

In contrast to the Euro, the GBP/USD rate fell yesterday. This was due to the U.S. Federal Reserve's March meeting showing only two of the 10 policy-setting committee members saw the case for additional monetary stimulus in the light of an improving economy. This strengthened the US Dollar and made it more expensive to purchase. In turn, the flght towards the Dollar also compounded the Euros weakness.

Today's Data

Today is very important for the Pound, as we have a raft of UK data. Industrial Production, Manufacturing Production and an interest rate decision for the UK. Later in the day we have the NIESR GDP estimate. This is very important as it could signal the UK is heading back into recession. In the Eurozone there are also Industrial production figures from Germany.

Today's GDP figures from the UK could easily wipe out the recent gains in the GBP/EUR rate, so contact us by clicking below to find out more about how we can protect you against adverse exchange rate movements.

Take the first step to making the most of your currency now and click here.

We are now closed for the Easter break from 6pm today until 08:30am Tuesday morning. Live rates will continue in the sidebar. Enjoy your weekend.

If you need to buy or sell foreign currency, send me an enquiry by clicking below and I will call you to discuss your requirements on Tuesday.

Pound dips below €1.20 / $1.60 - Interest Rates today

Wednesday 4th April 2012
Good morning. As I have been warning in recent weeks, the levels of €1.20 on the Euro and $1.60 on the US Dollar may not last forever, and indeed yesterday so the Pound fall slightly against both currencies, however upbeat manufacturing and construction data gave some support which limited the drops, as the better than expected data tempered concerns over a lack of growth in Britain's economy.

ECB Interest Rate decision; how could it affect GBP/EUR exchange rates?

Later today we will see the latest EU Central bank decision on whether they will make any changes to the base rate of interest. My forecast is that no monetary policy changes are expected from the European Central bank today. The same is true of the majority of the experts, with the general consensus that it is highly unlikely for the ECB to change interest rates.

45 minutes after the decision however, we have a press conference with ECB president Mario Draghi. In this he gives his opinions on the current state of the economy, and we often see his comments interpreted as an indication of future interest rate moves. So while I don't expect a rate change in the EU today, I will be closely watching the press conference for any hints of future monetary policy.

Some analysts are saying a hawkish message from the bank wouldn't be a surprise, as they need to get back to concentrating on quelling inflation instead of helping Europe's economy and financial system out of crisis may give the euro a brief boost. This could give the Euro strength and push exchange rates further lower. However some investors were still looking to sell the euro as concerns grew about a fragile outlook for the euro zone and high debt levels in Spain.

So, yet again there are views to both sides and so it's impossible to predict what effect today's ECB decision will have on rates.

Will the Bank of England announce more Quantitative Easing today?

I don't think that the BoE will decide to increase its bond purchase program, despite the fact that two of the MPC members called for it at the last meeting. The minutes from the BoE MPC March meeting revealed that David Miles and Adam Posen voted in favor of extending the bond purchase program. Unless there is a very sudden deterioration in the UK economy, I think the central bank will hold off on further stimulus for now.

"Sterling looks like an okay bet for now as most of the bad news for the UK has been priced in," said Geoffrey Yu, currency strategist at UBS. "But I don't think investors are actively (favouring) sterling and in the next few months we think it is likely to head lower."

Sluggish growth in the midst of a strict fiscal austerity programme has already forced the Bank of England into pumping 325 billion pounds of stimulus in the shape of quantitative easing into the economy. Other data from the service sector due this morning will be closely scrutinised for UK growth prospects and could have more of a lasting impact on the pound.

Today's Data

Staring in Australia again today, we see some Trade Balance figures that could affect GBP/AUD rates. In the UK there are PMI figures released which as mentioned above could have an impact on the Pound. Of more importance will be the latest announcement on any Quantitative Easing. The EU also has an interest rate decision today, followed by a press conference. This often causes more volatility than the decision itself, so we will be watching it closely.

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.

Click here to send me a free enquiry

Weekly GBP/EUR forecast, and the weeks data

Monday 2nd April 2012
Good morning. As always for a Monday morning, today I'll take a detailed look at Pound/Euro rate movements over the last week, forecasts for exchange rates in the coming months, and how economic data releases this week may affect exchange rates.

In this week’s Report:

• UK Could be heading back into recession
• EU debt crisis keeps GBP/EUR supported
• Round up of the week’s data that may affect rates

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

Sterling vs. Euro;

It was an interesting week for Sterling/Euro, in which we saw a raft of very poor UK data releases, but despite this, rates remained relatively stable and within the €1.19 to €1.20 range we have seen over the last few weeks. In this week’s GBP/EUR report we’ll take a look at the UK economy and why the Pound remains supported against the beleaguered single currency.

In a week in which the UK was bathed in unbroken sunshine, I’m afraid the sun was not shining on the UK economy. We had a raft of fairly alarming data releases suggesting the recovery in the UK is stalling.

Early last week saw Bank of England policymaker David Miles say that growth in the economy had effectively stalled, with growth rates near zero over the last six months. This keeps alive the slim chance of another round of quantitative easing, which usually weakens the Pound. The recent BoE minutes showed 2 members of the Bank of England’s rate setting committee voted for further stimulus, so there is an outside chance more QE could be announced soon.

This was followed on Wednesday by revised figures showing UK gross domestic product contracted by 0.3 % in the last 3 months of 2011, which was worse than the forecast for an unrevised 0.2% fall on the quarter. This was worse than the markets had been expecting and increases the chance of the UK heading back into recession. (2 consecutive quarters of negative growth is the technical definition of a recession.)With negative growth in the last quarter of 2012, the fear is that if we also see negative growth for the first three months of 2012, we will be in a double dip recession which would likely weaken the Pound.

These fears were supported on Thursday, and the downward revision was soon forgotten when the Organisation for Economic Co-operation and Development (OECD) has calculated that the UK economy has indeed contracted in the first three months of this year.

While this was just an estimate, it does cause concern as it came just days after Bank of England Governor Mervyn King warned the challenges facing the UK economy, and saying that Britain faces a long road back to economic growth.

So, with all the doom and gloom, poor growth figures and general pessimism surrounding the UK economy, you would usually expect the Pound to weaken against other currencies. In fact we saw the Pound remain supported against the Euro at just below the €1.20 level. So why was this?

Part of this was due to news that France's GDF Suez offered £6 billion to buy UK energy company International Power. This strengthened the Pound due to the possibility it could prompt robust demand for sterling, giving the Pound some strength.

This was only part of the reason however, as having a biggest impact on the fact GBP/EUR rates didn’t fall is the EU debt crisis. Despite the concerns surrounding the UK, they pale into insignificance when compared to Europe’s problems. Spanish government bond yields rose yet again last week, while Italian credit default swaps also moved higher, reflecting investor worries that the EU debt crisis is on-going and that Greece may need further funds.


Although the actions by European policy makers helped stabilize the financial markets in the short term, the actions have been seen by many as simply putting off the inevitable, the best analogy being simply “kicking the can down the road” and this is what is keeping the Euro weak and GBP/EUR rates supported.

If you are worried about how the EU debt crisis could affect your currency purchase, you can:

Download our free ‘Future of the Euro’ analysis for free here.

Moving forwards the forecast for GBP/EUR is impossible to read. It’s being pulled down by very weak UK data, but being supported due to the debt crisis. If you need to buy or sell Euros you should have a free consultation with us on the possible outcomes, and tools you can use to protect yourself against adverse exchange rates movements.

Click here to send me a free enquiry now.

Weekly Economic Data that may affect exchange rates









Monday – There is no UK data released today. Of note in the EU however are some inflation numbers and unemployment figures. Stateside we will see 3pm releases including Construction data and manufacturing production.

Tuesday – Some interesting releases from Australia today including an Interest Rate decision, Retail Sales and the RBA policy statement. Closer to home we will see UK Construction data and the BRC Shop Price Index. The EU has further inflation numbers to follow yesterdays.

Wednesday – Staring in Australia again today, we see some Trade Balance figures that could affect GBP/AUD rates. In the UK there are PMI figures released, but of more importance will be the latest announcement on any Quantitative Easing. The EU also has an interest rate decision today, followed by a press conference. This often causes more volatility than the decision itself, so we will be watching it closely.

Thursday – Today is very important for the Pound, as we have a raft of UK data. Industrial Production, Manufacturing Production and an interest rate decision for the UK. Later in the day we have the NIESR GDP estimate. This is very important as it could signal the UK is heading back into recession. In the Eurozone there are also Industrial production figures from Germany.

Friday – EU and UK markets are closed for Good Friday. We do have some data from the states however – Unemployment, Non-Farm Payrolls & Consumer Credit.

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GBP recovers despite possibility of UK recession

Friday 30th March 2012
Good morning. Well, what a difference a day makes. After seeing Sterling fall earlier in the week as outlined in my recent post the Pound regained ground against a beleaguered Euro yesterday, however the Pound did fall away from the recent highs against the Dollar. And all of this on the back of a host of poor economic data.

So to end the week, let's look first at the data we had yesterday, then I'll explain why the Pound actually gained against the Euro despite this!

Poor UK Data casts shadow over UK economy

Yesterday saw quite a bit of UK economic data that was worse than forecast. Firstly we saw that mortgage approvals fell last month, and money supply for February posted its biggest monthly fall on record. This was followed by figures showing poor growth in Britain's dominant services sector. We then learned that UK House Prices had their sharpest drop in over 2 years.

Then, to put the icing on the cake of doom the Organisation for Economic Co-operation and Development (OECD) has calculated that the UK economy shrank in the first three months of the year - if true this means we're back in recession that I also touched on yesterday. You can read more about the OECD figures here on the Telegraphs website. All of the above came just a day after data unexpectedly showed the UK economy had contracted more than previously thought in the fourth quarter of 2011.

So, with all the poor data why did the Pound gain against the Euro?

There was an interesting report on the Reuters website that British electricity supplier International Power had received a proposal from its majority shareholder, French utility GDF Suez, to buy shares it does not hold already.

This basically meant there could be a huge demand for Sterling, and this speculation caused the Pound to gain a little. As the chart shows we saw steady gains throughout the day yesterday.

It was mostly however due to the Euro weakening and becoming cheaper to buy. Italian and Spanish government bond yields rose while Italian credit default swaps also moved higher, reflecting investor worries that the EU debt crisis is ongoing and that Greece may need further funds.

The news weakened the Euro enough to brush of the poor UK data, and that's why the Pound rose against the Euro yesterday.

Sterling falls against US Dollar

Despite gains made against the single currency, the Pound fell from it's recent 4 month high against the US Dollar. With the poor UK data and also weakness in the Euro likely to drive investors towards the safe haven US Dollar, I don't expect rates to break $1.60. If anything I wouldn't be surprised to see rates fall for GBP/USD this year given the current climate.

Today's data that might have an effect on exchange rates

There are no UK releases today. To end the week we have German Retail Sales, EU Consumer Confidence. Stateside watch for Personal Consumption Expenditure figures, Inflation data, and a consumer sentiment survey.

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.

Click here to send me a free enquiry