Currency Market Overview
It is expected to be a quieter end to the week for Sterling exchange rates this week with no economic data of note due to come out which could mean the recent trend of Sterling weakness could continue. Over the last few weeks there has been a significant amount of movement, especially for GBP EUR exchange rates which have been incredibly volatile. Only a matter of a few weeks ago we were at a 2 year high but then following comments from Governor of the Bank of England Mark Carney who stated that Sterling was too strong and was damaging UK exports resulting in a slowdown in the economic recovery the Pound plummetted. These comments hark back to the days of Mervyn King during the recession when he continually talked down Sterling exchange rates meaning we saw GBP EUR exchange rates remain very low for a prolonged period of time. It is partly thanks to these comments that despite the fact it seems relatively clear the UK economy is in a better state than the Eurozone the Pound remains flat. The news this week that two members of the Bank of England voted for an interest rate hike was a surprise and provides some support to the argument that interest rates will go up in the UK this year however, a drop in retail sales was quick to dampen any Sterling recovery.
So, with so much unpredictable movement recently I think this week has summed up the currency markets very well, despite the fact things looked rosey for the UK you can never rule out a sharp drop in exchange rates with a few simple words from someone in authority leading to some major movement on the markets. So, for clients that need to transfer funds internationally it just goes to show how important it is to stay in close contact with your currency broker here at Foreign Currency Direct plc so they can keep you informed of all the latest movement and news in the markets. With all the different contract options we offer there are numerous different ways that clients can try and negate the exchange rate movement.
If you would like to find out more you can call straight through to our trading floor to speak with one of our experienced currency brokers for free on 0800 328 5884 or if calling from abroad call us on 0044 1494 725353 alternatively you can email me directly on firstname.lastname@example.org