The Pound has now hit a staggering 22 month high on the Euro. We start the week after the bank holiday, with Sterling at a mid-market rate of 1.239 on the Euro as the past week’s elections in Europe drag down confidence that the necessary austerity measures will be implemented to stem the European debt crisis. This is fantastic news for any property investors needing a Sterling to Euro transfer who may want to consider booking transfers in at these rates – some of the strongest we have seen for two years.

The French and Greek elections have not incited confidence that planned austerity measures will be followed through – particularly in Greece where the two main parties failed to secure a majority. This has thrown into doubt the future of the international bailout programme – and allowed Sterling, which has been performing well over recent weeks, to take the single currency even more by storm.

Sterling did not perform as well on the US Dollar over the past week. The Pound dropped by 0.71 percent overall to a mid-market rate of 1.615 against the Dollar – although weak non-farm payroll employment data in the US on Friday helped to prevent Sterling from dropping lower.

Overall, Sterling did well over the past week given that some of the key economic data from the UK was not as good as expected in the areas of manufacturing, construction and services. Although data was weaker than expected in these areas however, the PMI readings were still above 50 – a reading of above 50 indicates growth rather than contraction, indicating that the UK economy is still growing. Compared to European data at this stage therefore, the UK is coming out in a positive light making the Pound the more preferential currency for investors.

The key event to look out for this week is Thursday’s Bank of England monetary policy decision. Although it’s widely expected that interest rates will be kept on hold, policy makers will announce whether there will be an increase to monetary stimulus in the UK. This is not expected, but since the recent UK GDP figures were so disappointing, markets will be keen to have this confirmed on Thursday. An announcement not to introduce more monetary stimulus, could see Sterling push even higher.

This event however, will be set against a backdrop of other significant news on Thursday. This includes the European Central Bank monthly report and the US monthly budget statement which will give further insight into the health of these two economies. There is also trade balance information from the UK and the US. This will indicate how well or not the UK is minimising its trade deficit and could therefore also affect the Pound.

For further advice on how to save thousands on your property purchase compared to the bank, protect yourself from currency movements or set up regular mortgage transfers, get in touch with the dedicated Property Secrets currency specialist: Nigel Hodges of Currency Solutions on +44 (0) 207 740 0000 or by clicking HERE to leave an enquiry.