UK Inflation and Unemployment Falls
It was announced yesterday that UK inflation had fallen to the lowest level in 4 years at 2.1% just marginally above the Bank of England’s (BoE) target rate of 2%. This morning it was also confirmed that UK unemployment has fallen to 7.4% a reduction by 99,000 which is yet another step in the right direction for the UK economy and also for the chances of an interest rate hike. Previously Mark Carney, Governor of the BoE has stated that the Central Bank will consider hiking interest rates once unemployment falls to 7% this is all good news for Sterling which has shown some signs of strength this morning. However, at the same time the minutes from this months BoE interest rate decision have shown their concern about the strength of the Pound and the fact that the current Sterling strength could damage UK exports thereby harming the current UK economic recovery. This news should be worrying for any clients looking to transfer money internationally as these sort of comments can often be the death knell for any Sterling strength. Should the Bank really want to curb the current improvements in Sterling we could see a number of negative comments and maybe reduces the chance of an interest rate hike as theoretically an interest rate hike should bring GBP strength.
So, while the economy looks like it is on the right track it does not necessarily mean Sterling will benefit in the short term at least. As a result, for clients with an imminent transfer the Christmas period could be key as history has shown us that the exchange rates have been very volatile during the quieter festive period. So, if you need to transfer money internationally speak with one of our experienced currency brokers who will be happy to discuss the currency market outlook and the different options available to you, all of which can be tailored to your individual requirements. To talk to one of our experienced currency brokers call us on 0800 328 5884 or if calling from abroad call us on 0044 1494 725353 or alternatively email me directly on email@example.com