With the UK General Election looming this update discusses the potential GBP exchange rate volatility.

The below table shows the market movements for a number of currency pairings in the last 30 days:

Currency Pair% ChangeDifference on £200,000
GBP/EUR3.26%€7,766
GBP/USD1.84%$4,796
GBP/CAD2.68%$9,544

To keep track of rates visit our live foreign exchange rates.

UK Terror threat level raised to critical

The Pound weakened throughout the course of the day yesterday against its major counterparts following from the horrific attack in Manchester on Monday night. The UK’s terror threat level has been raised to Critical for only the third time in history, and it would seem that investors are moving their funds out of the Pound and into the safer currencies of the Euro and US Dollar.

UK General Election 2 weeks away

Another factor behind the weakening Pound is that, with the UK General Election being only two weeks away, uncertainty is beginning to build. The Conservatives are currently in the lead at 46% compared to the Labour party at 33% according to the Financial Times poll of polls. One of the main promises from the Conservatives is to cut UK immigration to under 100,000 per year after the UK has officially left the EU. This could cause the UK economy to reduce by between 1.5% and 3% by 2025. A report released yesterday from the Centre for Economics and Business Research has also warned that this could lead to a dramatic hike in public borrowing and could therefore prove damaging to the UK economy.

I would expect further reports released over the next two weeks to impact GBP exchange rates, therefore any clients with a short to medium term Sterling requirement should keep in close contact with their Account Manager here to take advantage of any peaks as they happen.

Will UK GDP data cause rates to fall to 1.14?

This morning will be a key driver for Sterling exchange rates, as at 9.30am Gross Domestic Product (GDP) figures for the last Quarter and Year will be released. The expectation is for these figures to match the previous time periods, however if these follow the recent run of poor UK economic data we may see another fall in the Pounds value, which could see GBP/EUR rates potentially falling into the 1.14’s.

For updates on how future data releases could affect your currency exchange you can contact our team of experienced brokers on 01494 725 353.

The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.

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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.