FCD Currency World Cup

Today is the eagerly anticipated semi-final of the FIFA World Cup and therefore the even more eagerly anticipated semi-final of the FCD Currency World Cup! Today see’s the efficient and mutch fancies Germans take on the host nation Brazil in a battle of flair and passion against efficiency and structure but in terms of the battle of the currencies it makes for interesting reading:

Germany – The Euro (EUR)

The Euro has remained under pressure recently against a number of the major currencies including Sterling however this week there is very little economic data of note due for release and so for GBP EUR exchange rate most of the movement will be dictated by the Pound with Gross Domestic Product figures from the National Institute for Economic and Social Research this afternoon and the latest Bank of England (BoE) interest rate decision due on Thursday. While it is not expected there will be any change in interest rates from the BoE the recent positive economic data for the UK means we cannot 100% rule out a move and so the markets will be watching the decision closely. So, expectation is for a relatively flat week for GBP EUR but the outlook remains relatively positive for Sterling and with Sterling Euro exchange rates close to a 2 year high there are currently some good opportunities to buy EUR.

Brazil Real (BRL)

Recent positive job figures from the US boosted demand for the Dollar which as a result has a negative knock on effect for the BRL as money flows back into the US with many investors selling off their Real to fund their Dollar purchases. This was on top of the fact that it was announced that Brazil had the largest government budget deficit since 2008 which made the currency less attractive to investors and lead to a weakening in the currency rates. The Central Bank in Brazil are already pumping funds into the economy to try and support the Real although this has had a negative impact on inflation and leads to concerns that the funding from the Central Bank is just papering over the cracks.

Comparing the two currencies it is clear that despite its recent issues the Euro is the stronger of the two, in fact the exchange rate is currently 3.026 BRL to 1 EUR, the question is will the FIFA world cup follow the FCD Currency World Cup?

If you need to transfer funds internationally and are looking for the best exchange rates it is important to discuss the market outlook, your currency requirements and the options available to you with one of our experienced currency brokers. You can call straight through to the trading floor for free on 0800 328 5884 or if calling from abroad call us on 0044 1494 725353 alternatively email me directly on trh@currencies.co.uk