Pound/Euro rates have risen higher, hitting €1.1725 this morning. Just last week it was down in the €1.10’s. The currency pair has risen more than 5% and is now sitting at it’s best levels in 2 months.
Why has the Pound/Euro rate gone up?
There are 2 reasons for the gain. Firstly, UK economic data continues to impress. Unemployment has fallen to an 11 year low, and Retail sales growth is at its highest in 14 years. The UK economy continue to prove resilient and if it were not for the uncertainty surrounding Brexit, the Pound would be much higher.
The second reason for the rise is a weakening of the Euro. The single currency is under pressure due to the political risks facing Europe, and the ECB indicated this morning that the EU economy is reliant on stimulus. This is keeping the Euro weak and making it cheaper to buy.
Will the Pound keep rising?
There is no way to know if Sterling will continue to gain, but it’s worth remembering that the reason the Pound has fallen so much in the last 6 months remains; Brexit uncertainty. Next week, we will have the autumn statement from the chancellor, and depending what it contains, it could stop the Pound’s rise. In the here and now, our clients can now buy Euros at the highest levels in 2 months, so it’s worth considering fixing a rate if you need to buy Euros, as there are no guarantees the levels will remain this high for long.
If you do want to hold out for further gains, then consider using a ‘Stop Loss’ order. This works by placing an order with us to buy Euros if the rate drops below a pre-agreed level, €1.16 for example. If the rate plummets then you know your worst case scenario, while still allowing you to take advantage of better rates if they keep going up.
Discuss your currency requirements, and get a quote
We have been helping clients achieve exceptional exchange rates for more than 10 years, and our rates are significantly higher than ususally available elsewehre. We also have various contract types such as Stop Loss orders, Limit Orders and Forward contracts to help protect you against adverse exchange rate movements. To get a free quote, simply complete the form below or click here.