This report will take a look at the cost of sending money overseas this week and factors that could affect your currency transfer, focusing on:
- US Economy Growing?
- Euro Crisis Talks
- Data Due Out Later Today
- Australian Growth Concerns
| Currency Pair | % Change | Difference on £200,000 |
|---|---|---|
| GBP EUR | 1.6% | €3,800 |
| GBP USD | 1.2% | USD 3,750 |
| GBP AUD | 2% | AUD 7,480 |
US Economy Growing?
According to official figures the US economy has grown by more than first estimated in the second quarter. The first estimate was 1.5% in April-June but the revised figure showed an improvement of 1.7%. However, although positive it shows a slowdown compared to the first quarter which was 2%. We have seen the GBPUSD exchange rate improve during this month by three cents or the difference of almost US$6,000 on a £200,000 currency transfer. This could also be partly due to the imminent risk of Hurricane Isaac which at the time of writing is hitting the coast of Louisiana.
Euro Crisis Talks
Both Angela Merkel and Mario Monti are holding crisis talks at the moment as Spain continues to suffer financially and the worry that Greece will not be able to keep up with its austerity measures to keep it within the Eurozone. Spain has recently announced that its economy has shrunk by 1.3% in the second quarter and one of its largest economic areas Catalonia has asked for €5bn from Madrid. See yesterday’s report.
However, on a positive note for the Eurozone Mario Monti has announced that Italy does not, at least for now, need a bailout. Italian bond auctions have seen costs falling, which is good news for Italy.
The next key summit is due to take place on October 18th as well as many other meetings due over the next few weeks. The main aim of the next summit is to decide what to do with Spain. Catalonia accounts to a fifth of Spanish economic output and so the recent news that it is struggling is bad news for the country.
With the high borrowing costs set to continue even after their €100bn bailout in June it is likely that they will need further bailout before the year is out. This could provide some very good buying opportunities for those needing to buy Euros
Data Due Out Later Today
Due out early this morning Germany announces its Unemployment Rate for August with expectations for 6.8%. Anything higher could see GBPEUR exchange rates improve so if you’re looking to make a currency transfer today please keep in close contact with your currency broker this morning. The Eurozone releases its figures for Consumer Confidence which I personally expect to be lower than anticipated again providing a good short term window for buying Euros.
Australian Growth Concerns
The Australian Dollar exchange rate has dropped recently owing to concerns of a global slowdown. The construction sector has slowed and expectations are for Chinese PMI data to drop from 50.1 to 50 which will be announced on September 1st. As Australia’s largest trading partner a fall in this data could lead to a less demand for Australian resources and therefore see a drop in the strength of the Australian Dollar.
Therefore, if you have a requirement to sell Australian Dollars into Sterling keep in contact with your account manager who can keep you updated with any movements over the next few days.
If you have any questions on how these or any other release may affect your transfers, feel free to call on FREEPHONE 0800 328 5884 or send me an email to teh@currencies.co.uk
