Sterling’s run has continued today, which is remarkable when you consider most of the move upwards is based on one opinion poll showing we’re likely to remain within the EU, as I outlined in yesterday’s post.
This morning we also had significantly better than expected UK Retail Sales. Monthly sales were up 1.3%, and compared to last year, up 4.3%. The markets were expecting 0.5% and 2.5% increases respectively, so the much higher numbers confirm the UK economy is stronger than originally thought. The rush to complete property deals before the stamp duty rise came into effect probably boosted demand for household goods and furniture.
Anyway, back to the exchange rate. Look at this week’s GBP/EUR chart:
It’s risen by nearly 3% so far this week, and most of it is on the back of one opinion poll in the evening standard, showing that 55% of people are expected to vote to remain.
Will this rally continue?
Sadly it’s impossible to predict. Personally I think that this is a very large move on the back of one poll, which are notoriously inaccurate anyway. Remember the general election this time last year? All the polls suggested a hung parliament, yet when people actually went to vote, the Conservative Party won by a clear majority. The polling industry received criticism for their inability to predict this clear victory. Food for thought.
There are still 4 weeks to go until the vote, and further polls and swings in the predicted result will continue to drive the rate of exchange. For the moment however, the GBP/EUR rate is the highest it’s been in 4 months. Certainly worth considering your options, some of which I outlined in my post yesterday, for both Euro buyers and Euro sellers.
If you have a currency transfer to make, and would like to get a quote or simply discuss the current market volatility and your options, send me a free enquiry today.