Sterling has moved up again on the Euro since last week’s blog. The Pound has inched close to a three and a half year high at times throughout the past week meaning that we start this week at a rate of 1.244 on the Euro as the Pound moved up by 0.79 percent overall on the single currency – something that you might want to take advantage of if you have a Sterling to Euro transfer to book.

The weak Euro is largely due to the aftermath of the French and Greek elections. The political uncertainty in Greece in particular, where it is not clear if a coalition Government can be formed, is calling into question whether austerity measures can be pushed through that are needed to stabilise the Greek economy and limit the damage of its debt to the rest of Europe.

Although this is helping Sterling to really gain on the Euro, it is simultaneously weakening against the US Dollar which is benefiting from all the uncertainty due its status as a ‘safe-haven’. The Pound has fallen by 0.5 percent on the US currency over the past week to a mid-marker rate of 1.607.  The US Dollar also received a push at the end of the week as JP Morgan, one of the biggest US banks, reported a 2 billion Dollar trading loss, making even more investors run to the safety of the Dollar.

Last week’s Bank of England monetary policy decision resulted in UK interest rates being held at 0.5 percent and the quantitative easing total being held at 325 billion pounds.  Although it was widely expected that interest rates would stay on hold, recent GDP figures suggesting that the UK is back in recession, made some predict that quantitative easing would be increased to help stimulate the economy. The decision not to do so, has helped to keep the Pound supported for now.

Currency investors will be in a better position to analyse the UK economy when the Bank of England publishes its quarterly inflation report on Wednesday this week. This may bring some movement to exchange rates as the Bank’s forecasts on growth and inflation are likely to come under close scrutiny – particularly after the recent negative GDP figures.

If you have a currency transfer to make involving Sterling therefore, it may be worth keeping an eye out on movement this week and seeing if the inflation report makes an impact. The current position of the Pound is still precarious also due to the threat of damage to the UK economy because of its close trading links with the Euro-zone. Don’t forget it’s possible to book the present exchange rate for a transfer in the future using a ‘forward contract’ to reduce risk and give you certainty about the exchange rate you will achieve.

As well as the inflation report, key events next week include the UK trade balance figures on Tuesday as well as European GDP figures. Wednesday also sees UK unemployment data which coupled with the inflation report, will give currency investors an insight into the overall health of the UK economy and could bring some movement to 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.

If you need a strong Pound for any upcoming transfers, you’ll be more than pleased to hear that the Pound is still soaring – now at nearly a two year high on the Euro, as well as the strongest it’s been on the US Dollar for eight months. This means that we start the week with Sterling at a mid-market rate of 1.227 on the Euro and 1.626 on the US Dollar. Don’t forget it’s possible to book exchange rates in advance of your transfer using a forward contract, so please do get in touch with me if you’d like to discuss securing the current rates.

The Pound showed exceptional resilience last week by suffering only a minor blip in strength when GDP figures indicated that the UK has returned to recession. Before the announcement, most economists expected that the Pound would suffer should a negative figure be released. It was announced that GDP had shrunk by 0.2 percent but the Pound managed to only slightly tumble, before regaining strength over the rest of the week.

The ongoing woes in Europe, coupled with the struggling US economy, are aiding the Pound’s current strength. Investors are choosing the Pound as the ‘safe’ currency to store funds in at present over some other major currencies which is helping it to rise. This was particularly true last week when fears increased about Spanish debt as the credit rating of Spain was downgraded and weak unemployment figures came out, spreading anxiety that Spain’s troubles will continue to bear down on the European economy. Similarly, in the US, more negative GDP figures were released increasing speculation that more monetary stimulus will have to come soon, making the US Dollar less attractive to investors.

Whether the Pound can maintain current rates remains to be seen. Economic data is proving to be fairly mixed with UK consumer confidence coming in low last week, but the ongoing optimism from the Bank of England minutes from the previous week dominating the mood around Sterling. It may be that some investors are assuming that the UK GDP figures will be revised upwards - if they are not, the negative GDP figure could start to eat away at the Pound in the longer term. On the other hand, it could be that if Sterling continues to push upwards over the next few weeks, we could find that the Pound has managed to define a new range and that the current rates become more normal going forward.

In the short term, next week sees several events likely to make exchange rates fluctuate. UK PMI data in the manufacturing, construction and service sectors from Wednesday through to Friday, will help confirm whether the UK really is returning to recession, as indicated by the GDP figures, or whether there is marked growth. There is also UK data in the areas of house prices on Wednesday and Thursday as well as lots of European data on Friday in key areas such as retail.

In the first half of the week, anyone looking to make a transfer involving Australian Dollars, should watch out for the Australian interest rate decision on Tuesday and the impact that this has on exchange rates. As ever, feel free to call me to discuss any upcoming transfers and how to deal with currency volatility.

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.

Sterling is in a very similar position to that which I described in my last blog – still holding within sight of a ten month high on the Euro but continuing to drop off against the US Dollar. We start the Christmas week with Sterling at the mid-market levels of 1.191 on the Euro and 1.554 on the US Dollar.

Currency movements are still being completely dominated by the situation in Europe. This means unfortunately that Sterling’s rise on the Euro is not being attributed to perceived strength in the UK economy (although UK retail sales data this week was positive) but rather that investors are seeking alternatives to the risky Euro. This explains why Sterling has managed to gain an impressive 1.77 percent on the Euro over the course of the past week whilst dropping by 0.8 percent on the Dollar which is perceived as much ‘safer’ than Sterling. This is also reflected in the Euro’s drop against the Dollar which is much larger than that against Sterling – a huge 2.57 percent over the course of the past week.

If you are going to need a Sterling to Euro transfer therefore, the message is still very much that there is no certainty about how long this position of strength may last. The Sterling to Euro 1.20 rate is also a key area of resistance that may be difficult for Sterling to break through. On the other hand, with nearly all the credit rating agencies downgrading European banks, and reviewing the ratings of nations such as France, it may be that if the European situation continues to deteriorate, the Pound could gain even more. This will also largely be dependent on whether robust new agreements are formed between political leaders about the Euro zone bailout fund and financial mechanisms to help restore the health of the Euro zone. At present, the main result of the hype in the press about the UK veto-ing changes to the treaty, and lack of unity between nations, is likely to be continued downwards pressure on the Euro.

The Pound hit a two month low against the US Dollar on Wednesday and it will again be news in the Euro-zone that continues to be the main driver of this currency pairing. There will however be a bit more of a spotlight on the UK this week with house prices coming out on Monday and the big event – the Bank of England minutes from the last policy meeting revealed on Wednesday. If this reveals that there is growing support among policy makers to introduce more quantitative easing in the Uk, it could be that Sterling loses some momentum on the Euro. European economic confidence figures and UK GDP figures on Thursday could also bring some movement.

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.

With so much uncertainty surrounding the state of the eurozone at present, there are some who are predicting that its very existence may soon come under threat.  Just a few months ago the thought of an all-out euro collapse was considered far-fetched, but now we find ourselves considering the ‘what if’’ scenario.

The events of yesterday's summit in Brussels seem like a last desperate push to bring the eurozone countries closer together. Europe's leaders failed to agree a change to the EU treaties. Instead the new rules will be adopted by 17 members of the eurozone and 6 states that are willing to embrace the new rules. These new rules are aimed to impose stricter control of member countries' tax and spending plans and to impose automatic sanctions on countries that overspend. This tighter integration is hoped to strengthen member commitment to the eurozone cause, however the euro-sceptics suggest that this will just cause further tussles and fights. With the debt issue still unresolved, it is difficult to see the positives of last night's event.

The question many of us are now asking is “what will happen if the euro capitulates?” Nobody can say for certain, but if you are looking to move your assets out of the euro, procrastination is something you should perhaps avoid. As currency specialists we are currently catering for thousands of clients who have had precisely the same concerns.

Speak to us today to find out how we can help you reduce your euro exposure risk.

Just register for a call back and a free Currency Report guide here or call 0207 740 0000 quoting 'property secrets' today!

As anticipated, Sterling’s movement throughout the past week has mainly revolved around what decisions were announced following the European Summits.

European leaders have agreed to strengthen the European rescue fund and have also unveiled a new plan for Greece. The result of this on the global currency markets, has been to restore confidence in the Euro, allowing it to make steep gains on other major currencies. Against Sterling, the Euro grew by 0.72 percent over the course of the week. This means that Sterling starts the week at a rate of 1.139 against the Euro. It is thought that currency investors had been using Sterling as a temporary safe-haven until clarity emerged about decisions made over the European rescue fund so we are now seeing a reversal.

This is not to say that the single currency will necessarily continue to strengthen on the Pound in the long term as the economic situation in Europe is still fragile. The Euro did actually move down from its highest point on Friday when Italy issued expensive ten year debt which caused the surge of optimism to dampen a little. It will be interesting to see over the coming week, how Thursday’s monetary policy decisions in both the UK and Europe affect the rate of exchange as both respective currencies have a potential threat to their strength.

For the Euro, the threat is that a reduction in European interest rates is expected to occur at some point this year which is likely see Euro weakening. Although most economists are not expecting an interest rate reduction to come until at least December, if comments made on Thursday suggest that this is on the cards, the Euro could see some downwards pressure. The threat to Sterling is that the introduction of more Quantitative Easing (filling the struggling economy with more funds to help it rebuild strength) could be supported yet again by the Bank of England policy members. If this occurs, it is likely to add downwards pressure to the Pound. How these two factors will affect the Euro-Sterling tug of war will emerge on Thursday morning.

Sterling’s movement against the Dollar over the past week makes for much more pleasant reading, with the Pound accelerating by 1.12 percent. This means that Sterling starts the week at around a seven week high of 1.612 against the Dollar and has logged one of its best monthly performances against the Dollar since April. This is despite fears for the ongoing weakness in the UK economy, and consumer confidence coming in at its lowest levels since 2009 due to anxieties over a return to recession.

Stay updated with Sterling’s performance particularly on Thursday this week when the monthly monetary policy decisions are announced by the Bank of England and European Central Bank. Feel free to give me a call if you would like me to watch the rates for you or to get a quote on your transfer.

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.

Last week was not a happy seven days for the Pound which fell overall by 0.58 percent against the US Dollar and a significant 1.59 percent against the Euro.

There was a particularly gloomy moment for Sterling last week when it touched the lowest levels so far in 2011 against the Dollar. A number of factors have been at play in Sterling’s demise, not least, a lot of talk about quantitative easing – a method of helping to reignite the economy that the Bank of England are thought to be drawing ever closer to. This was intimated by both Bank of England policy maker Martin Weale and referred to by Business Secretary Vince Cable last week.

Sterling was also not helped by the fact that currency investors took flight to the safe haven of the US Dollar in the early part of last week as rumblings over European debt sales and credit ratings caused currency investors to be nervous. The speculation over a possible Greek debt default did also cause the Euro to drop to a six month low on Sterling, but the single European currency then picked up over the rest of the week. This was due to certain progressions helping to calm nerves such as the news that China would buy up Italian bonds.

Most of the data coming from the UK last week did not help to spread much hope that Sterling might pick up. Although retail sales were not quite as poor as expected, the news of rising unemployment, lower wages and rising inflation expectations have not painted a particularly optimistic picture of the UK economy. This is all making the chance of monetary stimulus in the form of quantitative easing even more likely, with most wondering not if but when it will happen. This is likely to make Sterling less attractive to investors going forward and there are likely to be regular jitters when the Bank of England announce their monetary policy decision each month.

UK based property investors should therefore be cautious as the Pound doesn’t currently have much on the horizon in terms of a life line. Although the enormity of problems in the Eurozone could see the Sterling Euro rate improve, it’s equally as important to remember that the UK is also vulnerable to these problems with Europe being a main trading partner as well as there being strong financial links with UK and European banks. Don’t forget that it’s possible to book yourself into a rate of exchange prior to your money transfer to protect yourself from the uncertainty of fluctuations.

Key data and events to look out for this week include the Bank of England minutes on Wednesday which will reveal the voting and discussions that took place at this month’s monetary policy meeting – this could bring quantitative easing event more into the spotlight if discussions about this feature on the minutes. There are also UK house prices and consumer confidence figures on Monday as well as UK public net borrowing on Wednesday.

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.

Last week I reported Sterling’s recent movements - gaining on the Euro whilst dropping against the US Dollar. This movement has extended throughout the past week as the markets saw even more intensity – against the Dollar for example, Sterling tumbled by an astonishing 2.05 percent.

Sterling managed to keep climbing against the Euro to levels of 1.163, the strongest rates seen in over three months. This ascent gathered momentum from Thursday onwards when interest rate decisions were announced by both the Bank of England and the European Central Bank. Whilst both decisions were in line with expectations in terms of holding interest rates, Sterling found support from the fact that some economists had expected new quantitative easing measures to be announced by the Bank of England to help shore up the economy - this did not materialise as the economy was evidently believed to be robust enough for now which helped support the Pound.

Trichet’s comments following the interest rate decision in Europe on the same day did also not help the single currency as he identified ‘intensified downside risks’ to the economy with some predicting that European interest rates may have to be brought back down at some stage. The resignation of European Central Bank Executive Board Member Juergen Stark, reportedly over policy, also generated uncertainty and provoked more Sterling weakness.

Anyone interested in the Swiss Franc, will be astonished at some of the movement throughout last week. The currency plunged by 10 percent against the Euro as Swiss officials announced plans to intervene in order to artificially bring down the value of the currency and introduce regulations about how much it can grow against the Euro. This made the Swiss France unattractive to investors.

Sterling steadily fell against the US Dollar throughout the week to levels of 1.588. Confidence grew for the US economy as President Obama announced plans about a programme to stimulate jobs with an injection of 300 billion Dollars. There was also positive news concerning the US trade deficit which fell by 13.1 percent in July which was much better than expected.

The mixed picture of Sterling’s current movement, with the Pound growing against some currencies, whilst falling against others, reveals that the Pound itself has little internal strength at present. If you have Pounds to transfer therefore you should consider the current rates as very precarious. The strengthening position against the Euro is really under-pinned by weakness and problems in Europe. Although no quantitative easing was announced in this month’s UK monetary policy decisions, there is still a strong possibility that this could happen at some stage – and when it does we would expect Sterling to lose ground as the market is flooded with Pounds. It’s best as ever, to have target rates of exchange in mind, and make yourself protected against currency fluctuations. The second half of this week sees a wealth of data being released – from more UK retail data to CPI inflation data in the US. It may be another volatile week.

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.

The Pound has fared very differently against other major currencies over the past week so how this will affect any upcoming property investments will depend on the currency you need. Sterling lost 0.93 percent of its value against the Dollar but managed to gain by a very significant 1.06 percent on the Euro. This means that the Pound starts the week at the 1.62 levels on the Dollar and at the 1.14 levels against the Euro.

In truth, last week saw a fair amount of poor economic data coming out of the UK, Europe and the US so currency investors had to choose from a bad bunch – Sterling hit a three week low on the Dollar on Thursday after it emerged that manufacturing activity in the US was just slightly healthier than that in the UK. In the UK manufacturing shrank at its fastest pace for over two years with a steep drop in demand for exports. With more manufacturing figures due on Wednesday this week, it’s wise to see if these are once again negative and have an impact on Sterling.

The ongoing sovereign debt problems in Europe however are perceived as much more serious than any stagnant figures coming from the UK which therefore allowed the Pound to grow on the Euro throughout the week. Unemployment in the Euro-zone has now reached levels of 10 percent. Standard and Poor’s rating agency has also lowered their growth forecasts for Europe. It’s hopeful therefore that Sterling may continue to grow on the Euro throughout next week – this may well be dependent on figures at the start of the week that make the two economies easily comparable as PMI data on Services as well as Retail Sales figures are released from both the UK and Europe. This is before both the Bank of England as well as the European Central Bank announce their respective interest rate decisions on Thursday. This may well draw more attention to the fact that UK interest rates are expected to remain static well into 2012 or 2013 which is not good news for Sterling. However, European interest rates are similarly not expected to rise in the foreseeable future and in fact some speculation has started to circulate that they may in time need to be brought back down as the European economy struggles to cope.

There is some hope for Sterling re-strengthening against the Dollar this week as markets closed on Friday to a very negative report on US employment. We may therefore see some Dollar weakening at the start of this week. Both the US and UK trade balance figures are also due to be released at the end of the week which may help investors also interpret the health of each economy.

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.

Last week was volatile for the currency markets with a roller-coaster of events influencing exchange rate movements – first the US debt limit was extended, then moves were taken by the European Central Bank to buy back bonds as fears of the debt crisis engulfing Italy and Spain accelerated, and since the close of markets on Friday, ratings agency Standard and Poor’s has gone through with prior warnings and downgraded its rating on the United States to AA+.

What does all this mean for the international property investor who is interested in how the Pound is doing? Overall, Sterling dropped by 0.19 percent against the Dollar over the week and gained on the Euro by 0.54 percent. Movement was certainly erratic however, with the Pound in particular moving both up and down against the Euro in the early part of the week. The European debt crisis issues in the second half of the week allowed Sterling to capitalise on the single currency. The slight drop against the Dollar, can be put down to the Dollar’s use as a ‘safe haven’ currency by investors, as the panic about the spread of European debt between Euro zone nations hit the headlines.

These large-scale global events diluted the impact of internal economic news coming from the UK. Manufacturing PMI data early in the week was disappointing and yet another stagnant hold on interest rates at 0.5 percent on Thursday did not make for inspiring reading on the UK economy. Despite the fact that most economists are continually pushing back their expectations for when an interest rate rise will occur in the UK due to this kind of lacklustre data (with predictions having moved from summer 2011, to late 2012, to now even later – 2013) the Pound is currently still managing to keep up momentum from these external global events damaging confidence in the Dollar and the Euro. Looking at the month as a whole, the Pound’s strengthening has been consistent, with Sterling having grown by 2.31 percent on the Dollar and 2.78 percent on the Euro.

Although the agreement on the US debt limit also took downwards pressure off the Dollar last week, this may all change as markets assess the fact that Standard and Poor’s have now downgraded the US credit rating over the weekend. Some economists are therefore predicting we may see more downwards movement in the Dollar at the start of this week. Should the European crisis continue to escalate this week with more evidence coming to light of the flow of debt between nations, Sterling may also seize the opportunity to gain yet further on the single currency.

However, it will be important to look out for the impact of the inflation report and Bank of England Governor’s speech on Tuesday – Mervyn King sometimes has the tendency to talk down the UK economy which can have a negative bearing on 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.

Thankfully for those needing to make Sterling to Euro transfers, the Pound made some modest gains on the single currency throughout last week – this is even despite Europe raising interest rates again on Thursday up to 1.5 percent whilst UK interest rates were held at 0.5 percent once more.

The Pound has gained just over 1 percent on the Euro over the past week which is very good-going, especially given the interest-rate manoeuvres. The actual interest rate is still only kicking off the week at around the fairly uninspiring 1.12 levels but this is still an improvement on the 1.10s of the previous week. Sterling found strength last week from some very surprising PMI manufacturing data which completely stunned currency markets as it was revealed that manufacturing production had shot up for the month of May by 1.8 percent – far above and beyond the market forecast of 1 percent. This is the first really positive piece of economic news to come out of the UK in a while so although it is a good sign of growth in this individual sector, it is really only a single grain of hope and those needing a strong Pound should consider whether they would like to take advantage of the 1 percent increase on the Euro over the past week whilst this manufacturing data still has an influence.

The other factor which helped Sterling and managed to tarnish the news of the European interest rate rise (which would normally lift the Euro more than we saw last week) is that Europe was hit with a credit downgrading on Portugal by Moody’s Ratings Agency. Portugal’s rating was lowered to ‘junk’ status which warns that Moody’s believe the country may need another bail-out. This bad news limited the impact that the European interest rate rise had on raising the single currency last week but it is still important to note that in Trichet’s speech on the same day, he dropped many hints that the European Central Bank will be looking to raise interest rates again soon in the upcoming months. He also commented on the Portuguese issues and downplayed the extent to which these would negatively affect the rest of Europe. Again therefore, although the Pound managed to gain back on the Euro last week, looking to the longer term, there is still a possibility that continuing interest rate rises from Europe will continue to damage the Sterling to Euro exchange rate.

For those making property investments in the US, Sterling’s most recent movements against the Dollar over the past week have been much more tempered with Sterling moving downwards against the US Dollar by 0.36 percent in total. This is partly due to Sterling managing to push upwards on Friday when the US experienced a dire employment report. Looking over the past month as a whole however, is unpleasant viewing, with Sterling having dropped by 2.51 percent on the Dollar in total – quite a significant amount of money therefore on a property value. Economic data from the US however, as Friday’s employment figures showed, is still very patchy and so future movements could easily go one of two ways. The best bet is to get in touch with me to discuss your target rates of exchange so I can alert you if these are achieved, and how to protect yourself from these kinds of currency movements.

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) 207 740 0000 or by clicking HERE to leave an enquiry.

It has been another volatile week for the Pound. Anyone purchasing a property investment in the US will be pleased to know that Sterling grew by 0.73 percent on the Dollar last week. For those purchasing in Europe however, the story from last week has got even worse – the Pound dropped by 1.66 percent on the Euro throughout the week meaning that we start this  week at the 1.10 levels - some of the worst rates seen in fifteen months for those making Sterling to Euro transfers.

What is managing to make the Euro overpower Sterling in this way? Sovereign debt in Greece was the main issue affecting currency markets last week. Despite the widespread protests as reported in the news, for currency markets, the fact that Greek politicians passed another round of austerity measures, has shored up confidence that the crisis is being dealt with and saw an instant lift in the single currency. As this also helped to increase the ‘risk-appetite’ of currency investors generally, it also helps to explain whilst as the Euro rose, the safe-haven Dollar lost ground as well as other lower-yielding ‘safer’ currencies such as the Swiss Franc.

Sat in the middle of this cross-fire, the Pound therefore demised further against the Euro, whilst managing to gain ground on the Dollar. The US did also experience some negative data which contributed to this, with US consumer confidence figures dropping on Friday.

The ongoing interest rate saga running alongside the Greek situation was also to blame for Sterling’s fall against the Euro. Trichet made comments last week that have led markets to believe that there is a very strong chance that Europe will raise interest rates on Thursday this week from 1.25 to 1.5 percent which is now the official prediction. This is especially significant as the UK interest rate decision takes place on the same day, but rates are almost guaranteed to stay stagnant at the very low 0.5 percent. Whereas a few months ago, it was thought a UK rate rise would take place this summer, the UK is now seen as lagging even further behind in the interest rate race, with a rate hike very unlikely to come until 2012. Very poor UK PMI manufacturing data last week (the worst in 21 months) has only confirmed the view that an interest rate rise will take a long time to occur due to fragile areas in the UK economy.

This does not bode well for Sterling’s movements against the Euro this week so please do give me a call if you do have money to exchange in to Euros any time in the upcoming months as we can discuss your upper and lower target rates of exchange. Since January, Sterling has now dropped by nearly 10 percent on the Euro, which on the price of a property is incredibly significant. This makes it more important than ever to use a currency broker like myself, to achieve a better rate than the banks as well as making sure you are well equipped to book the transfer rate at the best time, given the wide scale currency movements that we are currently seeing. Speaking to me before the interest rate decisions take place this Thursday is advisable.

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) 207 740 0000 or by clicking HERE to leave an enquiry.

Bank of England policymaker Paul Fisher dovish tone kept alive the prospect of more qualitative easing in the UK. This has dropped Sterling to a session low against the dollar and the euro this morning.

Pound Sterling – UK Markets

Fisher said if Bank of England policymakers saw mid-term inflation turning into deflation, they may have to consider more quantitative easing. He added QE was very much on the table as a policy option.

The pound depreciated 0.5 per cent to 1.1274 against the euro as of 9:48 a.m. in London, the weakest level since June 10. Sterling declined 0.1 percent to $1.6179 and 0.2 percent to 129.77 yen.

The forecast for the coming months remains gloomy. Britain ran up a record budget deficit in the first two months of the fiscal year despite a slightly larger than expected drop in borrowing in May, highlighting the tough road ahead for the government.

US Dollar – US Markets

The U.S. currency touched an almost one-week low versus the euro before Fed policy makers begin a two-day meeting amid signs the world’s largest economy is losing momentum.

A report that’s predicted to show new home sales in the U.S. slumped in May, adding pressure on the Federal Reserve to keep interest rates at a record low.

“The problems of the U.S. far exceed Europe’s despite all the focus on Greece and the peripheral economies,” said Grant Turley, a senior currency strategist at Australia & New Zealand Banking Group Ltd. in Sydney. “The Fed doesn’t look like it’s going to be in a position to raise rates well into 2012, and that will keep the U.S. dollar under pressure.”

Euro – European Markets

The Euro softened in the morning as Euro-zone finance ministers failed to reach an agreement that would release the next tranche of 12B euros and would prevent Greece from defaulting on its debts.

Nevertheless, the EU backed the development of a second bailout for Greece and as a result the Euro erased the losses against the dollar and closed little changed at 1.4303.

Other Currencies – Highlights

The bond market is signalling doubts about Japan’s recovery from a record earthquake even as the Bank of Japan lifts its assessment on the economy.

The central bank last week raised its monthly economic assessment for the first time since February, as policy makers saw signs of a rebound. Data yesterday showed exports dropped by more than economists estimated in May, as Prime Minister Naoto Kan struggles to assemble a second supplementary budget before fulfilling a pledge to step down.

Nigel Hodges Currency Solutions

I reported last week that Sterling had lost out by 2.73 percent against the Euro in a single week following two weeks of negative data with poor UK GDP, and the worst manufacturing figures for twenty months signalling that the UK recovery was certainly fragile. The clash of UK and European interest rates on Thursday last week saw both economies hold their interest rates for another month. This was mostly expected and despite some more poor data from the UK, including a higher trade deficit, the Pound climbed on the Euro on the week overall, little by little regaining some of the lost ground on the Euro. Sterling was helped along by speculation circulating surrounding European debt, including claims towards the end of the week that Spain may be next in line for a European bail out as it was suggested that Santander experienced a failed bond auction. Comments from the European officials last week that seemed to hint that European interest rates may rise by another 25 points next month did not help lift the Euro. In total, Sterling gained on the Euro by 0.76 percent meaning that we start this week with Sterling in the early 1.13s on the Euro. This is still not the kind of exchange rate that makes pleasant listening for any UK property investors who need to make an exchange into Euros to purchase European property. If you want to know how to handle your exchange, it’s a good idea to give me a call or make an online enquiry letting me know the time frame for your property completion. I can talk you through the trading options available for you to decide how you would like to proceed and help you feel confident that you are more protected from any further currency fluctuation.

Despite clawing back ground on the Euro, Sterling dropped against the Dollar throughout last week by 1.21 percent overall so we start this week around the low 1.62 level. The US economy was one of the few major economies that experiences positive economic data last week  - the trade deficit narrowed,  the import price index was healthier and jobless claims had also reduced. The Dollar was also very much helped by the lingering debt problems surrounding European nations such as Greece as a clear flow of funds by currency investors into the ‘safe-haven’ currencies gave a lot of support to the Dollar.

Key events for the UK this week will be retail and consumer figures on Tuesday, unemployment figures on Wednesday with further retail figures on Thursday. The European Central Bank report on Friday will provide a further detailed analysis of the European economy from the Central Bank and may shape the sentiment of currency investors and cast some influence of the Sterling Euro pairing.

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) 207 740 0000 or by clicking HERE to leave an enquiry.

Rife speculation around Greek debt throughout last week did not manage to damage the Euro against Sterling. On the contrary, dire figures from the manufacturing sector in the UK last week (the worst in twenty months) building on the weak confirmed GDP figures of the week before, showed their impact on the Pound which lost out a very significant 2.73 percent to the Euro over the course of the week.  You won’t need me to tell you what a huge amount of money 2.73 percent is on a property purchase or sale. If you do happen to be selling an overseas home and bringing Euros back into Sterling then now really is the time to make the transfer – even if the exchange will not happen for several months, I can forward book the exchange for you at the current rate with just a ten percent deposit of the total. If however, you need to make a Sterling to Euro transfer you will be wanting to know if there is much news on the horizon that may help bring the Pound back up on the single currency.  The big event of the week will be the clash of the European and UK interest rate decisions on Thursday. Should we see the Bank of England make a hike up from 0.5 percent or the European Central Bank raise interest rates from 1.25 percent, we could well see the respective currency gain ground. Before this, we have the producer price index and investor confidence out in Europe on Monday, retail sales on Tuesday and GDP figures on Wednesday. With UK industrial and manufacturing data on Friday this could well be a volatile week for this currency pairing with significant data out every day. Please give me a call to discuss any transfers involving Euro and Sterling as I’m happy to keep an eye out for your target rate of exchange or help protect you from fluctuations throughout this week.

Against the Dollar, we are starting the week with the Pound sitting at the 1.64s. Although the currency has not managed to retain the levels of 1.65 seen two weeks ago against the Dollar, it is important to remember that it suddenly surged to these levels from 1.61 so despite losing out 0.51 percent to the US currency over the past week, we are still in a relatively strong position for the month as a whole. Although data from the UK, particularly in the area of manufacturing, has pulled the Pound down, the tail end of last week also bought some very bad data from the US economy so there is the potential for some volatility. In particular, the non-farm payroll figures which give a view into US employment patterns were much below forecasts with unemployment also creeping up. Moody’s ratings agency have also commented that they may put the US triple A credit rating on review for downgrade unless more is done to tackle debt by mid July – this could be a real blow for the Dollar should the downgrade occur and confidence be lost. The best way to catch the spike in your favour (such as the 1.65 levels seen recently) is to speak with me at Currency Solutions so I can watch the rate for you - and even set an automatic market-order on your behalf. It is important to remember however that we are still at fairly strong levels at the current rate of 1.64 so it may be worth you calling to get a quote on your exchange with me if you need a Sterling to Dollar transfer and haven’t done already – particularly if you are risk-averse and more keen to make sure you don’t miss out on the going good rate.

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) 207 740 0000 or by clicking HERE to leave an enquiry.

After a rather wet and windy bank holiday weekend it appears we may now be in the eye of the storm. With little news rearing its head out of the US and UK we may well be focusing purely on what is likely to happen next in Greece. Chances are all talks of restructuring have been thrown out the window so we are now awaiting the EU’s final move.

Pound Sterling

Don’t be surprised to see sterling tail away today and perhaps into tomorrow. This is mainly due to the lack of economic data that has surfaced due to yesterday’s bank holiday.

The only morsel of economic news worth mentioning from the bank holiday weekend is that growth forecasts have been cut by the British Chambers of Commerce. Whilst we expected growth of around 2.3 percent, this prediction for 2012 has been cut to 2.2 percent. Such revised forecasts will be seen as dovish by investors and thus the markets are likely to suffer.

Dollar

Similar to the UK, yesterday was a Memorial Day bank holiday in the US which meant there was little economic data being released. However, a report released today has stated that home prices fell by the most in 16 months during March. This coupled with an increase in home renters in the market have caused the dollar to fall.

With housing making up approximately 40 percent of the consumer price index and a rise in interest rates unlikely, an increase in the number of renters along with soaring gas prices could see inflation soar throughout the rest of the year.

Euro

The euro gathered momentum this morning, helped by talks of a second bailout for Athens and general US Dollar and sterling weakness. There has been serious debate over the last couple of weeks as to whether or not Greece will require total debt restructuring. However, reports suggest that European leaders are simply going to ‘throw money at the problem’.

Furthermore, Germany has once again stepped up to the plate. This morning saw the power nation report retail figures came in 3.7 percent above expectation. This has seen the single currency gain quite substantially against the majority of its counterparts.

Other Currencies – Highlights

The New Zealand Dollar climbed to record highs against its major counterparts on speculation the Central Bank will increase interest rates. This coupled with speculation of a Greek bailout package will increase demand for higher yielding assets that include both the kiwi and Aussie Dollar’s.

However, whilst the New Zealand Dollar is performing very well, the Australian Dollar has had its reins pulled back as reports showed their economy probably shrank last quarter by the most in two decades. This was more than likely due to floods that swamped coal mines and farmland.

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) 207 740 0000 or by clicking HERE to leave an enquiry.

Volcano’s are not the only eruption to be causing a storm in Europe at the moment. A conglomeration of events appear to be taking place at present with the European Union facing a debt crisis that could bleed through Greece, Spain and Portugal. Also, at a push, Belgium and Italy. Take this and add to it the search for a new leader of the International Monetary Fund and Ash Clouds threatening to shut down European air space and you have a mind boggling series of events threatening to topple the euro.

Pound Sterling

Word has it that the government was meant to be making spending cuts for some reason. This may have something to do with the spiralling levels of debt that our nation is facing. However, with this in mind it appears something has gone wrong along the way. Current spending by the central government hit £54.1 billion last month, a 5 percent hike from this time last year. Furthermore, with the recovery plans predicting a snail-pace like return to normality it is no wonder that the Chinese downgraded UK’s credit rating from AA- to A+.

However, as the general consensus quite rightly stated yesterday, it’s time to move on from old cliché’s. Yes the UK is underperforming, but this may not be reflected in the markets. The bottom line is with the state of the Euro looking far more uncertain sterling is seeing short term gains against the single currency.

Dollar

Whilst the US has problems of its own, in the short term investors see buying potential in the Dollar which could see the currency strengthen slightly. The Dollar index reached a seven week high before reports due to be released tomorrow are expected to show that the economy is recovering at a faster pace and initial jobless claims decreased for the third consecutive week.

On the other hand, global fund managers are keeping long term bets against the US Dollar. Whilst the Dollar is expected to rally from time to time, low interest rates will force investors to seek alternatives to US Bonds.

Euro

The façade surrounding Greece could create a debate that could fill the broadsheets a hundred times over. However, as we speak Greece may be forced to sell up to 50bn euros worth of state owned assets to push forward its privatisation drive. If Greece were to default a complex domino effect would take place. If like many you have been wondering why surrounding nations are so keen to avoid this from happening the answer is simple. A default would hurt major French and German banks with Greek subsidiaries, potentially causing a crash in share prices.

Other Currencies – Highlights

In recent days we have been commenting on the yo-yo nature of the Canadian Dollar. However, reports today show that currency may be faltering as indicators suggest that the global economy may be faltering. The loonie as it is often known has weakened against 12 of its most 16 most-traded counterparts.

The South African Rand broke back against the dollar after two days of losses. Commodities rebounded from the biggest drop in nearly two weeks and Greece’s endorsed budget cuts helped push the Rand into a strong position.

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) 207 740 0000 or by clicking HERE to leave an enquiry.

This week we are seeing a continuation of similar currency trends as reported in last week’s blog – once more, Sterling has lost more ground to the Dollar whilst managing to claw back against the Euro. This has been largely caused by intensifying speculation over the extent of debt problems in Greece just as a Portuguese bail out heats up. Markets finally glanced away from their intense focus on interest rates as they digested Trichet’s comments that the next European rate rise will not be immediate. Things also came to a head this Monday as finance ministers met up to talk about sovereign debt issues to the backdrop of the widely reported arrest of the head of the International Monetary Fund, Dominique Strauss-Kahn, which has led to some uncertainty over leadership and whether financial measures such as those affecting Portugal may be delayed. These issues tarnished the positive GDP data from Europe at the end of last week which revealed that GDP had grown faster than expected.

Those needing to purchase a property in Euros should therefore be aware that Sterling has gained 0.39 percent on the single currency over the past week. This was not without the usual twists and turns however with the currency falling down to the 1.11s against the Euro on Sunday before rising again on Monday. I have an increasing amount of clients selling properties in Europe who need to make Euro conversions back in to Sterling. If this is you, then we need to keep an eye out for these sudden movements as the sort of sudden rate seen on Sunday is great for a Euro - Sterling conversion. One way that you can make sure that you do not miss a rate, even if is touched momentarily, is to use an automatic market order – this means that if your target rate of exchange is hit even when our office is closed overnight or at the weekends, the money will be automatically exchanged for you. Feel free to give me a call to discuss whether this could be a good option for you and how it works.

It was another weekly drop for Sterling against the Dollar which benefited even more from Euro weakness than the Pound. This will not come as good news for those purchasing investments in the US. The fall was quite hefty with the Pound falling by 1.04% on the newly robust Dollar. Better than expected farm payroll data from the US in the previous week had helped the currency and the positive inflation report from the Bank of England, cementing opinions that a UK interest rate hike will happen later this year, was not enough to overcome the newly unstoppable Dollar. Although both the UK and US trade balance figures last week showed worse than expected deficits, the UK’s figures were particularly short of forecasts.

The biggest event for Sterling this week will be the Bank of England minutes on Wednesday. Markets will be rushing to find out whether there was any new support for a rate hike revealed in the voting patterns of members – if this were the case, Sterling is likely to receive another upwards push against the Euro.

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) 207 740 0000 or by clicking HERE to leave an enquiry.

Poor manufacturing, construction and house price data made the Pound vulnerable at the start of last week against the Euro. Property investors purchasing in Europe however will be pleased to hear that after dipping as low as 1.11 on Thursday, the Pound has more than compensated against the single currency after Europe held interest rates at 1.25 percent and Trichet suggested that it will be some time before European rates rise again. As some had conversely believed that interest rates in Europe would rise either this month or next month, Sterling managed to shoot up to the 1.14s against the Euro by the end of the week on the back of the news. This extreme level of movement on Thursday and Friday just goes to show how important it is to speak with me at Currency Solutions so I am able to alert you to these kind of sudden moves in the markets.

It is hard to yet say whether the Euro will continue to weaken. The scale of currency movements last week however were very significant and did suggest that the tide could be turning – alongside the interest rate hold was the Portuguese bail out plans in the headlines. The Euro also dropped by 3.3 percent against the Dollar over the course of the week. The US Dollar became the main benefactor of the sudden Euro weakness, with Sterling losing out by 2 percent to the Dollar over the week as a whole. This is not good news for those UK based property investors needing to send funds to the US so it is important to keep an eye on the rates. Unfortunately, the Dollar did manage to solidify its position at the end of last week with much better than expected non-farm payroll data – this is often considered the most insightful type of employment data in the US and could be treated as a key indicator that the US economy is picking up. Should the Dollar continue to strengthen there is always the option of using one of our protective trading options such as a forward contract to fix your rate of exchange in advance and be certain of the cost of your investment to you in Sterling.

For this week, Wednesday will be an important day for Sterling with both the trade balance and the quarterly inflation report due. The inflation report in particular is interpreted by markets in order to make more detailed guesses about when an interest rate hike will be made – should the report suggest that inflation is set to accelerate therefore, we could see some Sterling strengthening. Equally however, if it looks like inflation is creeping back down, markets may continue to choose the Dollar over the Pound. European GDP figures on Friday might help ascertain whether the Euro will continue to be rocked should they come in lower.

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) 207 740 0000 or by clicking HERE to leave an enquiry.

The long weekend in the UK sun has left many feeling positive and consumer spending figures fueled by the Royal Wedding celebrations and a likely boost from tourism are already being optimistically gestimated. Any positive figures will be gladly received after poor UK consumer spending figures were hit by the rising cost of living, coupled with nation wide pay freezes. In stark contrast to the Royal Nuptials, the notable news at the start of this week was the termination by US forces of Al Qaeda leader Bin Laden. The immediate effect was a lift in US equity futures, treasury yields, and the US dollar but this has now been unwound. To discuss how world events can effect your trade please contact your broker.

Pound Sterling – UK Markets

Contrasting data in the UK is leaving a few potholes in the road to economic recovery. Strong manufacturing figures are in contrast to constricted consumer spending. Sterling is currently down on both the Euro and the Dollar trading at 1.1160 and 1.65 accordingly at time of writing. Medium sized manufacturers saw orders grow at the fastest rate in 16 years in the three months prior to April according to the CBI with 23 percent experiencing an increase in export figures aided by a weaker pound.

The positive manufacturing figures are weighing in against poor consumer spending and according to some economists; the average middle income house hold will be 800pounds worse off this year if a pay freeze and increased inflation are taken into account. With little sign of an impending interest rate rise, a large correction in exchange rates is unlikely in the short term so clients looking to sell Sterling should speak to their broker to protect themselves against adverse further volatility.

US Dollar – US Markets

The US recovery looks set to be boosted by its manufacturing sector after 21 consecutive months of growth which has been aided by a weak dollar.

Although the manufacturing sector looks to be gaining strength, construction is following at a less consistent pace with February’s data being revised to show a decline of 2.4percent. Economic growth forecasts have been hindered by high energy prices which have weakened consumer spending causing it to fall to 2.7% from 4% in the previous quarter but the US Dollar is currently up against Sterling.

Euro – European Markets

The German economy has long been reported to be booming and Commerzbank; Germany’s second biggest lender has reported growth of 3.9percent. Whilst the trend for Germany is showing strong recovery, many of its Eurozone cousins are still well and truly left in the shade. European banks are facing concerns that the ongoing sovereign debt issues will face new turmoil in 2013 when many of the bonds issued to raise capital will come to maturity. Greece is attempting to negotiate another extension in its loans to avoid a full scale restructuring of its public debt after the expectation for a default has increased with the deficient currently standing at 10.4% of GDP.

Other Currencies – Highlights

Canadian industrial product prices rose 0.9percent in March, led by a 5.7percent rise in raw materials as world commodity prices soared. The CAD is currently trading at 1.5671 against Sterling.

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.

In last week’s currency blog, I commented on how nothing seemed to be able to stop the Euro in its tracks with the currency reaching the highest levels against Sterling in six months despite all sorts of debt issues being reported in the press. Well, there has been nothing like a major shift but the Euro has finally teetered down from its highest points and shown a little more vulnerability.

Those ongoing sovereign debt issues from the struggling Eurozone nations (known as the PIGS – Portugal, Italy, Greece and Spain) are creeping out of the woodwork. This is happening at a time when the initial excitement over the European interest rate rise which is what has been responsible for keeping the Euro higher has worn off – but only a little. With Ireland’s credit rating being downgraded and rumours circulating that Greek debt needs restructuring the Euro has dropped mildly against the Pound.

This will be of interest to those UK based buying property investments in Europe. It is definitely worth getting in touch with me for a quote on your exchange and to discuss target rates – and we can keep a firm eye on how this situation pans out. All in all, the Euro has still grown by 1.76 percent on the Pound over the course of the last month which equates to a few thousand Pounds on the average price of a property. This is why it’s so important to be aware of what movements are happening and book the transfer in at the best time – a forward contract allows you to do this and know the cost in Sterling even if your completion does not take place for months.

For those of you exchanging money into Dollars and other major currencies – Sterling is still in a better position against the US currency than the Euro although last week‘s less than forecast UK inflation figure has created some weakness which may continue with Sterling. The inflation figure has suggested to markets that the UK interest rate rise may not now arrive until nearer to the Autumn which is causing Sterling to weaken.

What is the key economic event to look out for this week? Wednesday’s Bank of England minutes are not expected to reveal any surprises, but should they show that any more members voted in favour of an interest rate hike this time round, then I would expect Sterling to strengthen.

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.

As those of you who have to transfer money over to Europe probably know, the Euro has been having something of a rally over the past month – and nothing seems to be able to stop in its tracks. This is bad news for those of you exchanging Sterling into Euros with the rates at around the worst levels that they have been in five months.

Why the Euro is so strong on first impressions can be difficult to understand. After all, the news is full of reports on the Portuguese bail-out, and the crisis with the Irish banks. Although these debt issues in individual nations may eventually come to a head and pull the euro down, for now, all currency investors have really been concentrating on is the issue of interest rates. Last Thursday saw Europe raise interest rates to 1.25 percent, whilst rates in the UK were held once more at 0.5 percent. This has confirmed the speculation that whereas Europe are tackling inflation head on and trying to provoke growth, the Bank of England are much more cautious about the speed of the recovery in the UK and when an interest rate rise could be withstood.

For those of you exchanging money into Dollars, the picture is much brighter, The US is still seen as lagging much further behind both the UK and Europe with an interest rate hike not seriously on the agenda as of yet and therefore Sterling is in a good position against the Dollar.

What will have an impact on movements this week? Tuesday will be a big day for Sterling with the latest inflation figure coming out. Should this have grown even higher than the 4.4percent figure released last time we could see some Sterling strengthening as this will add pressure to the Bank of England to raise interest rates. There is also potentially damaging data in the mix tomorrow such as retail sales figures (which last month were dire) and the trade balance for the UK so there could be volatility.

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.

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.

Sterling rates against the US Dollar have been very strong over the past few weeks and this has continued this week with the Pound reaching some of the highest levels in a year against the US currency. For anyone purchasing American property investments this is therefore great news. If you need to transfer money to the US in the future, don’t forget that you can use a forward contract to book today’s rate for a future deal. Feel free to speak to me with your queries on this.

The story against the Euro has been quite different which is unfortunate news for all of you who send money over from the UK to maintain properties in Europe or are indeed purchasing property there. Due to the fact that an interest rate rise is still expected to occur in Europe much sooner than in the UK (as soon as next month in Europe) the Euro has steadily strengthened on the Pound with us dropping down to inter-bank levels at worst of around 1.145.

This looked set to change yesterday when UK inflation levels came in soaring at 4.4 percent. This gave Sterling some renewed strength as this suggested that the inflationary pressure on the economy may force the Bank of England to raise interest rates sooner. This was quickly dampened today however when the Bank of England minutes from March were released which showed that no more members of the policy committee voted for an interest rate rise. This afternoon’s UK budget has also not helped the currency to strengthen. There has been some volatility throughout the afternoon with the Pound making further mild losses as markets digest the information included in the budget. The instant reaction suggests that despite targeted moves to promote growth in the weakest areas with measures such as scrapping the fuel duty rise and help for first time buyers, currency markets have not been encouraged enough to begin flowing of funds into Sterling.

Anyone who needs a Sterling transfer to Euros is best advised to speak to me at Currency Solutions to discuss target rates and protecting yourself from volatility. If you have Euros to bring back into Sterling, then now is a great time to book the transfer and take advantage of the rates.

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.

This is the best time in over a year to make a Sterling transfer into US Dollars following a significant drop in the dollar matched by a surge in Sterling on the back of staggeringly high inflation figures released in the UK this morning. If you have a Sterling to Dollar transfer in the future, it is a good time to check in with your broker now and find out about fixing rates of exchange with a forward contract to make sure that you don’t miss out. This morning’s inflation figure up at 4.4 percent will add renewed pressure to the Bank of England to raise interest rates.

Pound Sterling – UK Markets

Sterling has seen a surge overnight and this morning as CPI data revealed that inflation had grown to a staggering high of 4.4 percent. The Pound in particular is at its strongest levels against the Dollar since early 2010.

The inflation figure at 4.4 percent is over twice the Bank of England target of 2 percent and also higher than the official forecast of 4.2 percent. It also demonstrates another move upwards from last month’s figure of 4 percent. The soaring figure will suggest to markets that an interest rate rise may be forced from the Bank of England in early summer and has helped flout thoughts that this would be pushed back later into 2011.

This morning’s retail price index also came in showing above forecast growth for February with monthly growth at 1 percent.

Apart from the budget tomorrow, the Bank of England minutes released at 9.30am will be crucial for Sterling. Last month, the minutes revealed that three members voted for a rate hike. Should another member have joined the vote for a rate rise this time around, we could see some more Sterling upwards momentum.

US Dollar – US Markets

The Dollar Index, which measures the Dollar against its other major currency counterparts, has fallen to a fifteen month low. The Euro has reached four and a half month highs on the US currency whilst Sterling has reached its highest levels since January 2010.

This broad downwards pressure on the Dollar has suggested to some analysts that the its safe-haven status has all but vanished of late. A slump in US existing home sales which are at the lowest level in 9 years and the fact that there are no immediate expectations for an interest rate rise in the US in comparison to Europe where a rise is expected as soon as next month, and the UK where a rise is expected in the summer are adding further pressure.

Later today sees a speech by Geithner, Secretary of the US Department of Treasury on how he observes the current US economy.

Euro – European Markets

The Euro has soared against the US Dollar as expectations rise that the European interest rate hike will come next month following comments from ECB board member Gertrude Tumpel-Gugerell and council member Yves Mersch that strong vigilance was necessary to keep down inflation. There have also been comments to suggest that economic uncertainty due to events in Japan, will not, as some have expected, push back when Europe might make a rate rise. ECB Governing Council member Guy Quaden is due to speak in Brussels today.

Tomorrow sees industrial new orders data from Europe in the morning followed by consumer confidence figures in the afternoon.

Other Currencies – Highlights

The Canadian Dollar surged against the US Dollar by the most in almost seven weeks as crude oil prices continue to rise as turmoil in North Africa and the Middle East continues. As well as the rising oil prices, the Canadian Dollar is also benefiting from the return to riskier currencies as the nuclear crisis in Japan is coming further under control.

In last week’s blog, I reported that the time was ripe for booking Sterling to US Dollar transfers, with rates moving up towards 1.63. We are still in a relatively strong position against the US Dollar so anyone UK based buying property or sending funds to the US has not yet missed out.

Sterling rates against the Euro on the other hand, have swung down with the Pound at some of the lowest rates for five weeks against the single currency so this is a key time for those purchasing property in Europe to use me at Currency Solutions to help them keep an eye on the rates.

As has been widely reported in the press, rates between the Pound and the Euro are being largely driven by discussions over interest rates at present. Last week saw Trichet speak on behalf of the European Central Bank after the interest rate meeting – although interest rates were held at 1 percent as was expected, it was Trichet’s comments that sent the Euro higher. Whereas until last week, there was an expectation that a rate rise in the UK would come before a rate rise in Europe, the tables are now turning as Trichet suggested an interest rate rise in Europe might come as soon as next month.

The currency markets are never simple however and there are a multitude of other factors at play to be aware of in the Sterling Euro relationship. Whilst the hype over interest rates may continue to maintain the Euro’s strength in the near term, the sovereign debt problems with several Euro nations are still lurking in the background. Just this morning, the Euro was slightly shaken as news emerged that Moody’s Investors were downgrading Greek Government debt. With nations such as Greece trying to re-negotiate the terms of their debt with the European Central Bank, it’s important to remember that fiscal policy and debt tends to return time after time to haunt Europe – and indeed the Euro. The hype over an interest rate rise in Europe therefore may only compensate for some of the serious underlying problems in patches in the long term. The rate against Sterling will also depend on whether the UK interest rate hike – currently ear marked for early summer – is moved any further forward pending discussion at this Thursday’s rate meeting and the next set of Bank of England minutes in two week’s time.

Anyone who needs a Sterling transfer to Euros is best advised to speak to me at Currency Solutions to discuss target rates and protecting yourself from volatility. If you have Euros to bring back into Sterling, then now is a great time to book the transfer and take advantage of the rates.

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.

The Pound is starting the week at the 1.16s against the Euro – lower than last Monday when we came off the starting blocks at 1.17 but the Pound has actually regained some ground over the weekend from lower falls to 1.154 on Friday and 1.153 last Wednesday when we saw decidedly low GDP figures knock the Pound down.

This kind of volatility is becoming ever more normal of late as uncertainty over how well various economic recoveries are actually progressing is called in to question. Whilst there had been murmurings that UK GDP for the last quarter of 2010 may come in lower than forecast due to bad weather, nothing could have prepared the UK markets for the quarterly figure released by the Bank of England on Wednesday last week. The expectation for positive growth at 0.5 percent actually came in at -0.5 percent showing a slowing economy. Sterling took an instant slide downwards in reaction and the impact of this is likely to ensure that the currency is fragile for some time to come until stronger data comes in and shores up confidence. The fact that the monthly Bank of England minutes last week also indicated that an interest rate rise has been ear marked for August (when some had been getting excited that a rate rise may come as early as May or June) has also had a dampening effect.

Events to watch this week will be Wednesday’s PMI Construction data in the UK – markets will be hoping this may indicate whether or not the GDP figure was accurate or an under-estimation as it will reveal how construction fared in December and if the weather had the same significant effect.

US payrolls on Friday may have an impact on the American currency depending on whether these come in on target and continue last week’s good run. Broader market themes however are casting their influence above and beyond some of the individual data releases as the political uncertainty stemming from the Egyptian protests is pushing up safer currencies with riskier currencies such as the Euro becoming weaker over the weekend. ‘Safe’ currencies such as the Swiss Franc, Japanese Yen and US Dollar have pushed up in response to the situation in Egypt. Should protests continue throughout this week then this trend may dominate markets this week.

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.

Sterling has taken something of a battering this week. Although it has recovered some of the ground snatched away by Tuesday’s terrible – 0.5 percent GDP figures, subsequent data has not particularly lifted the mood. Judging by the Bank of England minutes, and poor consumer confidence figures coming in last night an interest rate rise does not looking likely until at least August. David Cameron has made a speech in Davros at the World Economic Forum with a strong stance on spending cuts being the way to get the UK economy back on track, although he did concede that the pace of recovery will be choppy.

With so much uncertainty in the UK markets and many of our clients having regular overseas mortgage or pension payments to make, this is a good time to ask your broker about our regular payments service. This allows you to fix a rate for your regular standing order so you have no nasty surprises as the months unfold!

Pound Sterling – UK Markets

The Pound slipped against the Euro as the CBI Trades Survey Data yesterday indicated trends in retail and whole sale distribution came in with a lower reading than expected for January. This was followed by GFK consumer confidence figures which were released at midnight and revealed a drop to a two year low in UK consumer confidence.

This downbeat end to the week in terms of data may shift slightly depending on how David Cameron’s speech on the UK economy in Davos is treated in the press and by markets. He has defended moves made by the coalition and whilst focusing on the seriousness of the economic situation, justifying spending cuts, he also highlighted progress made such as the UK’s ability to maintain its credit rating.

US Dollar – US Markets

The US Dollar fell against the Pound throughout the second half of yesterday on the back of weak economic data but is picking up again this morning. Poor weekly jobless figures were the key disappointment yesterday and markets will be closely watching US GDP figures for the fourth quarter today.

Initial jobless claims rose by 51,000 last week to 454,000 where only a rise to 409,000 was expected by markets. Durable goods orders also fell although existing home sales did rise by 2 percent in December.

Today’s release of fourth quarter GDP figures are awaited with baited breath following the shock contraction in UK GDP for the same period earlier this week. In theory, the GDP announcement, should in come in as expected and fuel the Dollar. An annual figure of 3.5 percent is expected, up from 2.6 percent in the previous quarter. Should this fall under expectation due to poor weather as was the case in the UK, the currency could be set for an end of week slide. The release is 1.30pm GMT so speak with your broker before then regarding Dollar rates.

Euro – European Markets

The Euro has experienced moderate gains against the Pound and Dollar and is still in a relatively strong position following Trichet’s comments that the European Central Bank are determined to keep a cap on inflation which has raised speculation about when an interest rate rise might occur.

Data yesterday also revealed that economic confidence was high meaning that news that Belgium may suffer a ratings downgrade due to political deadlock has now impacted on the single currency as of yet.

Other Currencies – Highlights

The Canadian Dollar has gained again against the US Dollar having now traded at levels stronger than parity with the American currency for the 23rd straight day.

The currency also strengthened against most of its other counterparts even though crude oil prices fell as stocks and copper climbed. The US interest rate decision yesterday to maintain the record low rates is also expected to shore up demand for industrial metals.

For a live quote or to tell us about your foreign exchange requirements, please click here or call us on +44 (0)20 7740 0000.

As we move into the third quarter of the year, the currency markets are under stress, as various worldwide economies have had to scale down their forecasts for growth and for some a double dip recession is still thought possible. The movements of the last few weeks have bought about a steep drop in Sterling against the Euro with the currency falling from above 1.21 against the Euro to the four month lows of the 1.15s. The Dollar is yet weaker, with the US currency therefore losing out to both the Euro and the Pound. Uncertainty still hangs over the currency markets, with other ‘safe-haven-currency’ nations such as Japan and Switzerland contemplating taking action to intervene in the currency markets and weaken their own currencies in order to protect their exports and therefore their recoveries.

To start with the Pound, the latest economic data has not been all bad. Today for example, saw a surprise improvement in the construction sector. The problem for Sterling at the moment is that many of the data releases have been generally disappointing, as well as the fact that any positive news tends to be over-shadowed by what is going on in terms of larger economic policy with increased differences of opinion between the Bank of England members. Following very poor public finance figures several weeks ago, showing higher than expected levels of debt, all eyes are now on the details of budget cuts to be announced later this month. At the same time, the latest Bank of England minutes showed that ‘increased stimulus’ for the UK economy was now thought of as increasingly likely. This has been followed up by the comments of Andrew Posen, policy member, who has called for further stimulus against the calls of Andrew Sentence, another Bank of England member, for an interest rate rise, suggesting that there may well be a three way split at the next meeting.

The situation in the US makes for even worse reading with the US Dollar receding against most other major currencies and finding its way to a six month low against the Euro. The US Dollar Index, which measures the Dollar against a basket of currencies is heading back down to levels last seen in January. Speculation over further financial stimulus is even more rife in the US than the UK, with the Federal Reserve Bank of New York President being the latest to speak out about the need for stimulus measures to calm the ongoing unemployment levels and inflation problems. Last week ended with poor manufacturing figures adding to the negative sentiments surrounding the economy. Later on Monday is a speech by the Federal Governor Bernanke which will be keenly watched by investors to see if any chances of further stimulus are mentioned.

And how long can the Euro maintain this level of strength? In truth, the Euro seems to be benefiting largely from the relative weaknesses in other economies rather than growing from its own internal strength. There have of course been some positive factors at play. A string of successful bond auctions as well as comments from China over the weekend that they would buy Greek bonds once Greece returns to the bond markets is good for investor confidence – the latest investor confidence figures also showed an improvement. There is a deep vulnerability in the Euro however which is stemming from the mounting fears surrounding debt, with the new headlines last week regarding the vast costs incurred by Ireland necessary to bailout the Anglo Irish bank. This, alongside the ongoing worries surrounding other nations such as Spain who had their credit rating downgraded by Moody’s last week, makes the Euro far from safe, even if for now it is largely dominating.

With rates being as they are, this is an ideal time to arrange or fix the rate in advance for any transfers involving selling Euros into Pounds or Dollars. If you do have an upcoming transaction that will involve you exchanging another currency into Euros, then we can also help you protect yourself from any further drops and minimise your losses.

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) 207 740 0000 or by clicking HERE to leave an enquiry.

Welcome to our new weekly Pound report from the Currency Solutions newsletter - providing a day-by-day analysis on the GBP.

Each day the Currency Solutions team review the Pound, Dollar, Euro and other top movers with a daily newsletter sent to your inbox.

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Monday

The halting of interest rates last week suggested that the BoE are taking a ‘wait and see’ stance on the country’s hesitant economic recovery and this made for a quiet few days. This morning at 1033 GMT the pound traded above the 1.510 level against the dollar at 1.5116 and 1.1084 versus the euro.

Some economists say that a weakening pound is good for Britain at present, not only because it tends to boost economic growth by making British goods and services more competitive on world markets, but also because it will help to rebalance the structure of the economy.

Tuesday

Sterling dipped below USD1.50 this morning, approaching the lowest level against the dollar in 10 months, as data showed a drop in UK house prices. The pound traded at 1.4987 at 0923 GMT.

The Royal Institution of Chartered Surveyors said its monthly house price balance dropped to +17 in February from a downwardly revised +31 in January. The data showed that February's decline was the sharpest one-month fall since April 2008.

Traders have also been unnerved by a ratings agency report on the impact of the eventual reduction of state aid on British banks.

Wednesday

Sterling slid to one-week lows against the dollar and euro today after data showing an unexpected fall in British manufacturing gave the pound another clout as it still remains dazed from political and economic uncertainty.

Data showing British manufacturing output declining 0.9% in January, the sharpest monthly rate since last August pushed the pound to fall over 40 pips against the euro, and 50 pips against the dollar in today's mid-day trading. At 1428 GMT it traded at 1.4956 versus the dollar and 1.0978 against the euro.

Fears about a hung parliament were flagged by political opinion polls yesterday and concerns about Britain's sovereign ratings after a ratings agency highlighted the country's worsening credit profile.

Thursday

Sterling managed a slight recovery from its lows yesterday but many believe this could well be a period of calm between storms as political and fiscal pressures continue to burden UK currency.

 At 0903 GMT, sterling traded close to flat against the dollar at 1.4977 and has since moved down slightly to 1.4961 at the time of writing. Euro/sterling was unchanged in early trading at 91.10 pence, off Wednesday's high of 91.30.

Adding to the negativity was concern over Britain's sovereign ratings after Fitch Ratings highlighted on Tuesday the country's deteriorating credit profile.

On Wednesday Prime Minister Gordon Brown said he believed Britain would maintain its coveted top credit rating also saying that economic recovery remained fragile and to change course now would risk plunging Britain back into recession.

Later today the British Consumer Inflation Expectation Report may cause some ripples in sterling’s waters.

Friday

A poll showed the opposition Conservatives gaining 39% of the vote, with the Labour Party on 26% forecasting an outright majority win for the Tories.
Earlier at 0905 GMT, sterling was up 0.3% against the dollar at USD1.5103 and currently at 0954 GMT trades slightly above that level at USD1.5139.

However, the pound failed to make much of a case against the euro which was steady in early trading and currently sits at EUR1.1012.

Investors are remaining cautious as recent polls have suggested the election could result in a hung parliament, which would potentially hamper any incoming government's efforts to cut the UK's expanding budget deficit.

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Nigel Hodges www.currencysolutions.co.uk

Like the Liverpool football team, the pound is failing to have much success in currency markets at present as a raft of weak economic data is conspiring to keep the UK currency weak.

As the global economy staggers towards a recovery, the way forward still remains rocky as reflected in currency exchange markets this week. US labour market figures came in weaker than expected, with unemployment rising to 10.2%, while on the other hand, equity markets hit a 13-month high. This has led to a see-saw for currency exchange rates between risk appetite and risk aversion, although with most of the major currencies finding more stable trading ranges than in recent months.

In the UK this last week, the pound suffered pressure ahead of the Bank of England MPC decision, but eventually rose after the Bank decided to expand their asset purchase program by GBP25 billion rather than the expected GBP50 billion. Sterling later received a boost following news that the manufacturing sector PMI expanded into positive territory for the month of October but has since dropped back to hover around the 1.66 mark against the US dollar and 1.11 against the euro. This week brings the UK unemployment rate and the Bank of England inflation letter.

Currency exchange rates for the US dollar have held their ground after the FOMC voted to leave interest rates unchanged at 0.25%, and signaled that rates may remain low for some time. Equities in the US rallied after US automobile giant Ford announced profits of nearly USD1 billion in the 3 months to September, as the “cash for clunkers” initiative helped to revitalize the automobile industry. Overnight, US equities have reached a 13-month high after the G20 nations G20 pledged to maintain support for the global economy.

Euro currency exchange rates have remained relatively unchanged, as the euro is supported by strong German trade figures and the rise in currency diversification internationally. PMI figures for manufacturing in the eurozone also came in stronger for October, while unemployment rose to 9.7%. There remain nagging doubts in the region as to the stability of recovery, with the banking sector still regarded as unstable. This week UBS has reported greater than expected losses and the French finance minister warned against “banks on steroids” due to government cash injections. This week brings third quarter GDP figures from Germany and France.

Elsewhere, Australia raised interest rates to 3.5% while forecasting three times better than expected growth in 2010, yet the Aussie and Kiwi currencies have fallen from recent highs amid concerns that the currencies have rallied too sharply in the wake of the financial crisis. The Aussie dollar has slid 0.4% against the US dollar while the kiwi fell 0.6% this week. 

So at present, the global economy retains some of its uncertainty from recent months. Equity markets have experienced a sharp rally recently, complimented by positive activity in the manufacturing sectors of the US, UK and eurozone, yet unemployment continues to be a major drag on economic recovery.

If you need to conduct currency transfer, the best option is to contact your Currency Solutions broker who will provide you with excellent exchange rates and up to the minute market information. Registration with Currency Solutions is free with no obligation to trade. To see how much you could save, phone us on 0207 740 0000.

Nigel Hodges (Currency Solutions).