If you have been hoping that the Pound will strengthen for any upcoming property investments, this week’s blog brings good news. Sterling starts this week back above 1.20 on the Euro at a mid-market rate 1.205 having climbed by 1.01percent over the past week. It has also grown overall by 0.55 percent on the US Dollar to a mid-market rate of 1.581.

Although the European situation is still the main influencer of currency movements, Sterling’s rally this week also reflected the positive PMI data that came out in the sectors of UK manufacturing, construction and services. Coming after the previous week’s worrying GDP data which suggested a return to recession may be on the cards for the UK, the growth shown in these three areas has hoped to calm nerves and suggest that a return to recession is not quite as likely as previously thought.

Sterling was also helped by the fact that the Euro was plagued by talks over Greek debt dragging for the whole week. Greece has been in talks with its private creditors to arrange a deal to avoid it defaulting on its debt. This worked to first bring more optimism around the European currency but then started to exert a downwards pressure on the Euro as discussions seemed to be dragging on without a negotiation being reached.

Although these Greek worries helped to lift the Pound and UK data last week also helped to provide some upwards momentum, there are events due this week which could bring a tidal change. Namely, the next Bank of England monetary policy is decision is due on Thursday -there has been a lot of speculation that an increase in Quantitative Easing will be announced on Thursday to help prevent the UK from returning to recession. If this announcement is made, we would expect to see some downwards pressure on the Pound. However, the run of good PMI data this week may have been enough to convince policy members that this isn’t required.

Thursday is certainly the day to watch – not only is it the Bank of England’s monthly monetary policy decision but also that of the European Central Bank. There is some speculation that the ECB may reduce interest rates in Europe which would be likely to push the Euro down. Thursday also sees the UK Trade Balance figures released as well as data on the performance of UK manufacturing and industrial production. Feel free to give me a call before Thursday to discuss how economic events may affect exchange rate and impact on any upcoming property purchases or sales.

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.