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.