Getting the best rates is helped by understanding what is affecting exchange rates and the service of a specialist currency broker. Below are movements in the last month affecting Pound Sterling rates when buying £200,000:
|Currency Pair||% Change||Difference on £200,000|
The Pound suffered further losses yesterday against the Euro after the Office for National Statistics released new estimates that the UK’s current account deficit was larger in 2015 than originally thought. It has now been estimated that the deficit was around £98 billion in 2015 compared to the previous figure of £80 billion, and although this has improved in recent times, this sort of level could be enough to trigger a financial crisis in a less developed country. The next estimate release will be on 29th September and is expected to improve as early 2017 data has already seen the deficit narrow.
Yesterday the UK’s new Chief Trade Negotiator Crawford Falconer began his work, and although any trade agreements can only be established after the UK leaves the EU, it has been reported that he is already “building bridges” with the European Commission. It was also reported yesterday that the UK are pushing for the EU not to separate goods from services in Brexit discussions, in a bid to push discussions forward to the second stage. The lack of clarity on Brexit negotiations is, in my opinion, the main reason for Sterling’s fall in value. With this in mind, I feel that as soon as any information is released regarding negotiation developments, Sterling could rebound swiftly and clients looking to purchase Pounds with Euros could miss the best time to do so in 8 years. We have a number of contract options available to our clients, including our Forward contract which allows you to book the current rate of exchange for up to a year in advance, for a small deposit.
The week so far has been relatively quiet for UK data releases, however this morning at 9:30am sees the release of Public Sector Net Borrowing figures for July. This is the amount of new debt held by the UK Government and is expected to be released far lower in July compared to the previous month. If this is the case, I would expect Sterling to regain some of its lost ground and could climb above 1.10 for the first time since last Thursday.
The major UK release of the week will be on Thursday when Gross Domestic Product (GDP) for the second quarter of this year will be released at 9:30am, and measures the country’s total output. Although no change to the previous period is expected, any variation is likely to cause volatility for Sterling.
For further information on how upcoming data releases could affect your currency transfer, call our currency experts on 01494 725 353.
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