Could the Pound fall further against the Euro and the impact of Article 50 on exchange rates (Tom Holian)
The rates for buying Sterling with Euros has seen the best exchange rate in almost 4 years during the course of this week as rumours increase that the UK could be getting itself ready to trigger Article 5 by early 2017.
Foreign Minister Boris Johnson has said whilst on a trip that the UK will begin formal Brexit talks by ‘early next year’. This caused the Pound to plummet vs the single currency during Friday’s trading session providing some excellent opportunities to sell Euros to buy Sterling.
If you’ve recently sold your property in Europe or looking at selling shortly then this window of opportunity could be a good chance to take advantage of these lows.
The uncertainty caused by the original vote to leave the European Union caused huge losses for Sterling vs the Euro and until we get any assurances as to when the talks will begin this is likely to cause further problems for Sterling Euro exchange rates.
Many people have been saying what goes down must come up and yes that it true in currency as it’s a cyclical market. However, at the moment there is little positive news coming out from the British economy and the uncertainty surrounding the Pound could cause further weakness for GBPEUR rates.
Next week sees the release of UK GDP data for the second quarter which will cover the Brexit period and I would not be surprised to see the data come out negatively compared to the expectation. Clearly British businesses were uncertain as to the result so are likely to have been keeping their budgets to a minimum during this time so I am anticipating further problems for the Pound vs the Euro by late next week.
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Sterling exchange rates have stabilised this morning have fallen to a one month low against the Euro. Brexit concerns remain and the pound has declined in value across all of the major currencies over the last 10 days. There has been strong talk from many European figures stating clearly that Britain will not get a good deal. The Maltese Prime Minister who will be chairing Brexit negotiations in the New Year made it abundantly clear that he wanted to see Britain get a bad deal. He stated that a Brexit deal “must be inferior”. Negative talk like this is bad news as far as the pound is concerned.
Following on from Theresa May’s address at the United Nations last night some American banks have yet again raised concerns over Brexit. It all points to a protracted period with the markets being driven by uncertainty. For the moment there is an excellent opportunity for selling Euros.
This morning sees the release of official Public Sector Net Borrowing figures from National Statistics. Expectation is for a substantial jump higher in government debt following Brexit from £-1.5 billion to £10.3 billion.
This has the potential to be a big market mover this morning with considerable volatility to be expected and added pressure on the pound if the numbers are poor.
If you want to be kept up to date on the markets and you would also like to ensure that you are getting the very top levels of exchange for an imminent currency transfer or even a longer term one then I can help you with this.
Not only do we give clients up to date market information but we all work for one of the largest and longest serving currency brokerages in the U.K, so even if you have dealt with your current broker or bank for a long time I would be surprised if I could not show you a saving over what they are offering you – You can email me James Lovick directly on email@example.com and I will be more than happy to contact you personally to discuss the various options we have available to you.