Pound to Euro exchange rates continued to tumble yesterday due to poor UK PMI data. Exchange rates dropped 0.75% making a €200,000 purchase £1,300 more expensive. The next economic piece of information that could have a major impact on exchange rates is the Bank of England’s decision this Thursday. If the Monetary Policy Committee decide to cut rates I expect to see further falls for Pound to Euro exchange rates and therefore parity is looking more likely as some major banks have forecasted.
Since the UK public decided to vote out of the EU, GBP/EUR exchange rates have dropped 20 cents and many clients have taken advantage of the 5 year highs! For clients that are prepared to wait to see if GBP/EUR exchange rates continue to fall they should keep a close eye on the ECBs Quantitative Easing program. President Mario Draghi has hinted that the Q.E. program could be extended as early as December this year. When the Q.E program was introduced in March 2015 the Euro dropped in value and I expect the same trend would follow if we see an extension.
Thursday the economic bulletin which is released by the ECB every two weeks and gives guidance to the state of the European economy is to be released at 9am and Unemployment rate which is a measure of unemployed workers divided by the civilian labour force will be released at 10am. The unemployment numbers are set to fall, therefore we could see further strength for the Euro against Sterling.
With the economic indicators suggesting further falls for GBP/EUR exchange rates, if you are buying Euros before Christmas the safer approach would be to purchase your currency sooner rather than later to minimise risk. If you would like to discuss an upcoming transfer you can email me at firstname.lastname@example.org and Id be happy to assist.
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