In my last blog I described that Sterling rates against the US Dollar had been particularly strong with us reaching some of the highest levels in a year. Unfortunately for those exchanging Sterling into Dollars, this has now completely reversed. The Dollar has had a new found rally since last Friday after several policy makers in the US made public comments to suggest that an interest rate rise as well as the withdrawal of stimulus measures there being used to shore up the economy may be made sooner than expected. The US had been seen as seriously lagging behind Europe and the UK in terms of economic recovery whereas this kind of talk suggests that the gap is getting closer. If you need to make a Sterling to Dollar transfer therefore for a property investment this is a time to be very careful in terms of what may happen with exchange rates as the tide is turning. You can speak to me about options we have to help you protect your transfer from this kind of volatility.

There is more bad news for Sterling in rates against the Euro. Despite the fact that the Euro has dropped against many other major currencies due to a plethora of problems emerging in various member states, the currency is, infuriatingly for those who need make a transfer into Euros, still holding very strong against the Pound. Problems with Portuguese debt levels as well as the defeat of Angela Merkel’s party in Germany have bought a cloud of uncertainty over Europe seeing it sliding against currencies such as the Dollar. Against the Pound however, the fact that an interest rate rise is expected in Europe possibly in April, far earlier than a rise is due here, is keeping the Euro stronger.

The Pound is also weak due to the UK’s own internal problems. Dire retail figures came out last week for February which were taken quite seriously by markets. They were so low that they suggested the VAT rise might after all be having a negative effect and also caused the UK’s AAA credit rating as a nation come under potential threat.

All in all, not good news on exchange rates for those needing to make a Sterling transfer into another currency. You can speak to me about how to protect yourself from these kind of drops. If you are selling a property abroad and bringing money back to the UK of course, the exchange rates are very much in your favour.

For further advice or 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) 20 7740 0000 or by clicking HERE to leave an enquiry.

With Nick Griffin, Katie Price and the X factor’s latest batch of irritants hijacking newspapers, screens and radios, it was hard to imagine that news this week could get any more horrific. That was of course until GDP data was announced on Friday, creating a chorus of chatter suggesting that the Bank of England will extend their Quantitative Easing programme at their meeting next week.

This came after a week of ups and downs for the pound, which staggered in with a hangover last Monday after the Sunday Times said Bank of England policy-maker Adam Posen may support an extension of the central bank's asset-purchase program. However, the resulting 0.5% drop against the greenback was short-lived and by Wednesday sterling was alive and kicking striking a one month high against the dollar at nearly 1.66 and 1.11 versus the euro. This followed minutes from an MPC meeting which saw the committee voting 9-0 for no policy change and a hold on further quantitive easing measures.

The pound did however receive a sharp reality check towards the end of the week and by Friday morning UK currency struggled to sustain market levels of 1.09 and 1.64 against the US dollar.

Today’s speculation on the QE programme being extended was reiterated by former MPC member David Blanchflower. Looking like the archetypal bearer of bad news, he made an appearance on Bloomberg TV and said that the Bank of England could extend by as much as GBP250 billion in all from the current 175 billion.

If you looked closely enough at the dollar last Tuesday, you may have seen George Washington’s expression turn increasingly despondent as it plunged to a 14-month low against a gang of other currencies. Strength in global stocks saw traders opting to sell the greenback for higher-yielding currencies and assets more closely correlated with economic recovery. Only options-related buying kept US currency from reaching 1.50 against the euro and 90 against the yen.

The dollar remained vulnerable for the rest of the week, hitting a new low for the year against a rampant euro, which strengthened throughout the week on the back of an array of upbeat reports. The GBP1.50 barrier was well and truly broken and analysts seem confident that there is still upside potential for further gains.

The Australian dollar rose against the greenback to its highest level since August 2008 last Tuesday, touching USD0.930 as Reserve Bank of Australia Assistant Governor Philip Lowe said it is "appropriate" to remove stimulus as Australia's economy progresses. So far this year, the Aussie has risen more than 30% against US currency.

Things weren’t as bright for the Canadian dollar on Wednesday, which took a sudden tumble after the Bank of Canada decided to keep its interest rate at 0.25%. The bank had warned that favourable economic developments were being undermined by the Canadian dollar's strength. On the very same day the New Zealand dollar leapt nearly 1% to USD0.75, following comments from the Reserve Bank chief Alan Bollard stating that “a strong currency was not necessarily an obstacle to raising the cash rate.

Elsewhere, the yen held near three-week lows against the US dollar last Monday on expectations Japanese investors will short the yen as they step up purchases of higher-yielding foreign bonds. Throughout the week Japanese currency struggled near two-month lows against the US dollar and was not far from a one-year low against the Australian dollar at 84.20 yen.

Although speculation suggests the US is likely to return to growth in the second half of this year, recovery is far from certain. The Obama administration still needs to rein in a record USD1.4 trillion budget deficit and will be looking to pile more capital into the banking system. Although it’s already pushing more than USD1 trillion into the economy and lowering the benchmark rate to near zero, analysts believe this isn’t quite enough.

Because currency exchange rates change every second, timing your trade to get the best exchange rate can be difficult. Currency Solutions can help you make the most of your currency transfer by providing expert market information and bank-beating exchange rates. Our personal currency brokers watch the markets on your behalf and help you get the best exchange rates for currency transfer. Visit us online at www.currencysolutions.com or phone  0207 740 0000   to see how much you can save.

Nigel Hodges (Currency Solutions).

Like the nations MPs, currency rates for the pound remained under pressure this week, as the expenses scandal continues to haunt UK politicians. You know things are bad when you have to pay for your own gardening and the pound fails to crack 1.08 against the euro. Yet positive signs from the labour market may have revived some faith in the pound, and we may see the UK enter the recovery phase soon.

In the UK last week, the lowest inflation rate in 5 years put sterling under pressure, although Bank of England MPC member Charles Bean revived some confidence by talking about an end to quantitative easing. The pound received a boost late in the week as jobless claims rose by 21,000 which was less than markets were expecting and the unemployment rate held at 7.9%. This is largely due to a lower rate of redundancies and average earnings figures were unchanged from last year.

This news sent the pound to a 3-week high against the US dollar, rallying above the 1.60 resistance level to touch on 1.61. Economists are predicting the UK economy could be close to a turning point, however at present, the underlying trend in sterling remains bearish. This week brings government borrowing figures and the latest MPC minutes.

Exchange rates for the greenback are also on the back foot, after minutes from the MPC meeting showed that US interest rates are likely to remain low for some time. This sent the US dollar to a 14-month low against the euro and 15-month lows against the New Zealand and Canadian currencies. Near-zero interest rates are making the dollar an attractive proposition for carry trades at present. Consumer price index figures and jobless claims are expected to be positive for September, which could induce some volatility later in the week.

The euro has continued to benefit from a rise in risk appetite, reaching a 14-month high against the US dollar to trade just below 1.50 after the Fed indicated interest rates would remain low. German ZEW economic expectations came in slightly weaker than expected, surprising markets after positive manufacturing data earlier in the week. The German economy is expected to grow by 1.2% next year after shrinking 5% in 2009.

Elsewhere, emerging markets stocks have posted their longest rally in four years on the back of rising oil prices and improved figures from China. Japan voted to keep interest rates on hold and the Australian dollar remains buoyant, trading at its highest level in around 25 years against the pound. Australian interest rates are the highest of the G10 nations at present and strong demand from Asian markets is driving the economy forward.

While the picture remains glum in the UK, with high government debt and interest rates expected to stay low throughout 2010, jobless figures this week show that the pace of decline is moderating. At present the weak pound is supporting the UK export sector and the Bank of England may look to reign in quantitative easing levels in the first half of 2010.

Because currency exchange rates change every second, timing your trade to get the best exchange rate can be difficult. Currency Solutions can help you make the most of your currency transfer by providing expert market information and bank-beating exchange rates. Our personal currency brokers watch the markets on your behalf and help you get the best exchange rates for currency transfer. Visit us online at www.currencysolutions.com or phone 0207 740 0000 to see how much you can save.

Have a good week!

Nigel Hodges (Currency Solutions).