Market Snapshot
The table below shows the percentage movement of exchange rates yesterday, along with the extra currency you could have bought if buying with £200,000.
| Currency Pair | % Change | Difference on £200,000 |
|---|---|---|
| GBPEUR | 0.6% | €1500 |
| GBPUSD | 0.35% | $1,000 |
| GBPNZD | 0.6% | NZD 1,750 |
| GBPAUD | 0.5% | AUD 1,300 |
This report will take a look at the cost of buying foreign currency and factors that could affect your currency transfer as detailed below:
- Greek Deal Agreed, Finally
- Other News
- Australian & New Zealand Dollar Focus
- Currency Today
Greek Deal Agreed, Finally
With a lack of major economic data yesterday the markets eagerly awaiting the postponed Greek decision. Rumours had been going round that the “Elements were in place” for the Greek bailout to go ahead but the discussions kept going until late in the night (13 hours of talks in fact). The deal was finally struck to allow Greece to take the €130 billion second bailout.
The Euro saw a strong day on hopes it would go ahead although the pound lost ground against most currencies in particular the Euro losing 0.5% whilst staying fairly static against the US dollar on the US Presidents Day bank holiday.
Considering the Greek news came out late last night, expect a volatile morning as the markets react to it today! Some news will be priced in to the market already, although with Greece out the way for a little while there is still room for the pound to lose more ground towards the 1.1750 levels.
Other News
Positive news came out for the UK property market with house prices rising 4.1% in February according to Rightmove whilst UK mortgage lending for January also picked up from this time last year complementing the house price data and painting a better picture for the UK.
The price of oil has recently touched an 8 month high over nuclear issues in Iran and so it will be interesting to see how the dollar reacts today with the US opening for business again. The dollar is one currency that often loses ground on the price of oil rising. If you have a foreign currency exchange transfer to make in US dollars then now might be a good time to consider a limit order to try and achieve the 1.60 level. Please get in touch with your currency broker to discuss the various options available to you.
Australian & New Zealand Dollar Focus
There have been two key beneficiaries surrounding Greece – The Australian and New Zealand dollars. With a more steady outlook for the time being then expect to see continued strength for these two currencies in the coming days pushing towards the 1.44 and 1.85 levels as they now benefit from a better outlook for world growth.
This morning saw Reserve Bank of Australia release the minutes from the last meeting and it appears they are in no hurry to cut rates any time soon which should help see the dollar maintain its stronghold.
Currency Today
The calendar is fairly bare again today – UK Public Sector Net borrowing figures for January are released at 08:30 which could make for an interesting start for the pound. Forecast is to show a dramatic improvement in the UK accounts and also to show a surplus which could lend support to sterling today although Greece should dominate. Eurozone confidence figures for February are released at 15:00 and are expected to show a negative sentiment which may weigh on the Euro.
Tomorrow should be more interesting with the Bank of England minutes. We could see a small reaction for sterling exchange rates particularly if we discover it was a unanimous vote for additional QE. Whilst we know QE was extended by £50 billion it has also been well publicised that the door has been left open which should hinder sterling for the next few months.
To discuss how these issues may affect your requirement call us on 0800 328 5884 or 01494 725 353 or e-mail me directly jll@currencies.co.uk
