Daniel Wright
Sales Director
Euro falls as Article 50 may be extended
Sterling gains against the euro as the possibility of a ‘no deal’ Brexit becomes less likely.
Request a quoteThe euro has seen losses against the pound on the interbank exchange so far this week, as the pound strengthens as MPs’ decide to legislate against a ‘No Deal’ Brexit.
Germany’s manufacturing sector continues to struggle
However, in addition, the euro has been weighed down this week, because of increasing evidence that Germany, the Eurozone’s largest economy, could be headed for recession. For example, we learnt this Monday that Germany’s manufacturing PMI, from IHS Markit, fell to just 43.5 this month, easily below the 50.0 figure that points to growth. In addition, this Thursday, it was revealed that Germany’s factory orders tumbled by -5.6% in July compared to a year ago.
In part, this is because the USA’s and China’s trade war is cutting demand for German exports, like industrial components and cars. Germany’s manufacturing sector makes up 20% of its GDP, and is arguably the Eurozone’s backbone, so if German factory activity continues to contract, Deutschland may soon enter recession.
ECB tipped to cut interest rates, extend its stimulus
Meanwhile, the European Central Bank’s (ECB) interest rate decision next week is being tipped to affect the euro on the interbank market. This is because, to support the Eurozone’s economy and lift stagnant inflation in the bloc, the ECB is forecast to cut interest rates again, and restart its Quantitative Easing (ECB) program. In particular, it’s thought that the ECB will cut its deposit rate, which it charges commercial banks to park money at the ECB overnight, further below -0.4%.
Also, the ECB may begin to inject up to €30 billion a month in QE into the Eurozone’s financial system, to stimulate economic activity. However, while the ECB’s actions could perk up the Eurozone, they simultaneously tend to devalue the euro. So the ECB’s decision may be worth watching for on September 12th.
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C. Thompson
France
Absolutely brilliant service, in particular special thanks to Mr Daniel Wright, who literally took care of us throughout the whole process (we are both pensioners)… we entrusted our life savings to him, and don’t regret it one little bit, Daniel was incredible.
D. Ryder
UK
Daniel Wright was easy to deal with over the phone and very professional. It made the International transfer very quick and easy. I would definitely use them again and recommend to friends.
M. Bickerton
Spain
Daniel Wright at Foreign Currency Direct came highly recommended to us by a friend and he and the Company have lived up to this recommendation with every transaction they have completed for us.
J. Warnes
UK
It’s a tad daunting and scary to change currency with a hitherto unknown company, and I was worried about it beforehand. My fears were unfounded: I can assure you that this firm is genuine and does exactly what they say they will do. Daniel Wright is a pleasure to deal.
K. Morrice
Spain
The company gave me great confidence. A complete novice, as I am, in moving large amounts of monies around, my wonderful account manager Daniel was calm and precise in explaining the process to me. He was flexible, informative, professional, friendly. If I can recommend him to anyone then I surely will.