The pound ended last week on a high and even yesterday being a UK bank holiday, the pound still found some room for improvement with the levels of 1.18 being hit.
There are very few data releases to keep an eye on this week however this may not mean the pound will stagnate. With less than a week until even more covid restrictions will be relaxed the Prime minister confirmed yesterday afternoon, the new rules will mean outdoor pubs, shops, gyms and hairdressers will all be allowed to open which could have a positive effect on the economy with more people pumping money into it and this could have a knock-on effect of increasing the value of the pound. This turn in positivity could cause more issues elsewhere potentially in France who have only recently gone into their third lockdown and places such as Italy and Belgium have also introduced strict rules over the long weekend to try and curb the infection rates.
Although major international travel may not be on the cards for a lot of holidaymakers due to ruling in and outside of the UK, Boris Johnson has tried to give lots of options for travel and other major events such as sports and concerts. He outlined that there are three ways in which they will allow travel and events to re-open and they include a negative lest in the last 48 hours, proof of a covid vaccination (covid passport) or proof of a positive test in the last 6 months as it will offer natural immunity as long as the quarantine period is served. This is good news for holidaymakers both leaving and entering the UK both of which could cause and positive turn for the pound.
Over the next few days, there is due to be quite a bit of data being released from countries which can have their effect on the euros strength. The first will be the Spanish unemployment change at 8 am which will state how many people are unemployed and searching for work, then at 9, we will be both the Italian months' unemployment rates due to the month of Februarys umbers being missed in march so both sets of data will be released. Finally, for today there will also be jobless claims for the whole EU across all the countries in the Bloc. All of these pieces of data can cause a change in the strength of the euro especially the EU unemployment level as it shows the percentage of the Bloc currently out of work and is normally deemed as a negative for the euro but if the numbers are better than expected the value of the euro could take a positive upturn. Also, something to keep an eye on if you are doing a euro transaction is the Spanish, Italian, French, German and Bloc PMI data being released, please stay in touch with your account manager for all the latest information.
There is no major data being released today in the US however tomorrow we will see the Crude oil inventory numbers which can have an effect in both directions depending on how positive the news is, as a rise in the price in oil has a knock-on effect for lots of other sectors causing the price of many products to increase which can be seen as a negative for the economy. Also happening tomorrow is the Federal Open Market Committee minutes, which shows in-depth economic and financial conditions of the economy and based on how the committee see the future of the economy they will potentially change interest rates accordingly. This is hotly watched not just to see where the new interest rates will be if they change at all, but the Feds understanding of the economy can be the most important to understand what the future might hold for the United States economy and consequently the strength of the dollar. Then later in the day the chairman of the central bank Jerome Powell will speak and even the tone of his statement can cause fluctuations to the greenback's value due to his highly influential position in the Federal Reserve.
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