The Pound is continuing to fall today against the Euro today, despite a brief spike last night on the news that Mark Carney would slightly extend his term and step down after the 2 year Brexit negotiation period has ended. This gave the Pound a little spike and first thing this morning, mid-market levels were at the dizzying heights of €1.1175. However the spike was short lived, as seems to be the case these days, and at the time of writing we’ve seen the rate drop over a cent into the €1.10’s. it’s been quite steady against the US Dollar however, which means the Euro is gaining strength. This is because with the US election coming up, investors are moving funds into the safe haven Euro due to the uncertianty, making it more expensive to purchase.
Pound may fall another 5% when article 50 triggered
Despite decent economic data, nothing seems to be able to halt the Pound’s slide at the moment. Analysts polled by Reuters said that they expect Sterling to fall by another 5% as soon as article 50 is triggered next year. If you think the currency markets are volatile now, next year will make them look relatively calm. Once negotiations start, any scrap of news about what deals are being made will likely cause huge swings in the rate of exchange.
If you need to exchange Sterling to another currency, then give serious consideration to locking in a rate with a Forward contract if you want to be protected against the rate continuing to fall. We can help you lock in the current rate of exchange for up to 2 years into the future, and you only lodge 10% of the funds you want to convert. You can settle the remainder of the contract in part of in full throughout the contract time period. This is especially useful for budgeting for a property purchase abroad.
It’s not all bad news of course; the weak Pound makes converting a foreign currency into Sterling extremely attractive. If you are selling property abroad and want to get the best rates of exchange, then consider placing a ‘Stop Loss’ order. This works by placing an instruction with us to convert funds if the rate goes back up above a pre-agreed level, €1.15 for example. In this way, you can still take advantage of gains of the Pound continues to weaken, but not risk losing out on the current levels should we see the Pound bounce back.
Ensure you get the best exchange rate
If you want the best rates, click here or complete the form below to send me an enquiry. We offer rates of exchange that are higher than banks and other brokers usually offer, so even if you already have an account with a currency broker, take a few minutes to compare our rates to ensure you’re getting the best deal.