With the currency markets moving every two seconds, it can be vitally important to be aware of what is driving the currencies in or out of your favour. The table below shows the difference you would have achieved in Euros when buying £200,00.00 during yesterday's trading hours.
|Currency Pair||% Change||Difference on £200,000|
The pound received a much needed boost on Wednesday following better than expected quarter 3 growth. Gross Domestic Product or GDP grew 0.4% for the three months to September and leaves the door wide open for the Bank of England to raise interest rates for the first time since July 2007 next week.
This was the main reason for the Pound’s jump yesterday. In fact, any clients looking to buy Euros yesterday would have received exactly €3000 more on a £200,000 transfer if timed correctly, highlighting why being in contact with your broker is of such importance.
For any clients looking at buying currency with Sterling, doing so now may be the time to do so.
My reasoning for this, the markets have a rate hike on the November 2nd policy meeting at 83% for the Bank of England to raise rates. Whilst this is almost certain, the currency markets always have the ability to surprise and if the Bank of England choose to not raise rates, sterling could be in for quite the drop in value. Inflation in the UK has only just reached 3 percent and wage growth along with economic growth still not showing enough in many people’s minds to warrant a rate hike.
Although the Pound received a welcomed boost from data yesterday, the pound still remains vulnerable over Brexit, with the Brexit Secretary David Davis and Prime Minister Theresa May seemingly at logger heads over when MP’s will have the ability to vote on the deal with the European Union. Davis hinted that MP’s wouldn’t be able to vote on a deal until after the March 2019 deadline, effectively after Brexit. Theresa may defied this by saying she was confident a deal would be reached in time allowing MP’s to have a vote, adding to the confusion and not doing much to help lift investors’ hopes.
Yesterday, the Prime Minister Theresa May and Jeremy Corbyn faced Prime Minister Question’s or PMQ’S with Theresa May seemingly coming off worse. ‘This government doesn’t know whether it’s coming or going’ was one heckle Theresa May received from Jeremy Corbyn. I can’t help but agree and until this feeling subsides I would expect the pound to remain at the mercy of the UK government.
For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.
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