The Pound has continued to rise against the Euro and other currencies, rising to €1.1340 against the Euro, and $1.3034 against the US Dollar. The reason for the gains is progress with Brexit negotiations. The chart below shows how Pound/Euro rates have moved over the last 3 months:
As you can see, the Pound has strengthened by 3% in the last month, rising from €1.10 to €1.1350 which is the highest Euro buying rate we have seen in 3 months. The gains come as the outlook for Brexit is beginning to look a little better. There have been serious worries recently that the UK would be leaving the EU without a deal. As this becomes less and less likely, the Pound has gained. There is more optimism that both sides will make concessions to reach a deal, which could happen as soon as this months EU Summit, but I think November will be the soonest we’ll hear what they manage to agree.
When will a Brexit deal be agreed?
If compromises can be made on the Irish border and terms can be reached in November, then the Pound could strengthen further. If there is any delay beyond this however, then I think Sterling will drop quite sharply.
It’s also important to remember that even if a deal is reached, it then needs to get through Parliament here in the UK. That’s where politics could come into play, and if Labour decide to vote down the plan to try and hurt the Conservatives, then it’s also going to hurt the value of the Pound significantly.
Buying Euros – your options to get the best exchange rate
If you need to buy Euros, then the current levels are very attractive. Buying €250,000.00 today is £6,800.00 cheaper than a month ago. So if you need to buy Euros, your first option is to fix the rate now while rates are good. Even if you don’t need your Euros now, you can freeze the rate by paying a deposit of 10%.
Another option is a ‘Stop Loss’ order. This is an instruction for us to buy your currency if it drops below a pre-agreed level, e.g. 1.12. If you think that rates will keep going up this is a good option, as it allows you to continue taking advantage of any gains, but not leave yourself too exposed should the market drop back away. A ‘Stop Loss’ gives you a worst case scenario should Brexit talks falter and rates drop back away.
If you need to make a transfer, then get in touch today to discuss how we can help. Our rates are very competitive, and can be up to 5% better than your bank or existing broker may be offering you.