Currency news and exchange rate volatility at the moment
have been dominated by the Greek debt crisis, which has had knock on effects
for many major currencies as well as the Euro. For those of you buying property
abroad, who will need to make international payments in different currencies,
the prospects for November are even less clear than usual.
For the Euro, we have seen the single currency react
strongly to developments in the Eurozone regarding the package to bailout the
troubled Greek economy and in particular its inability to repay its debt to
commercial banks around the world. While the UK and therefore sterling is
exposed to European sovereign debt, the Euro itself has strengthened whenever
the outlook has been positive (when last weekââ¬â¢s deal was announced) and
weakened, giving better exchange rates for
sending Euros, whenever the outlook has been negative (as when George
Papandreou made the shock referendum announcement).
Much may depend in the coming weeks on whether Greece
implodes with political plate-smashing (cheaper Euros) or comes up with a plan
to ratify the deal ââ¬â and quickly (more expensive Euros).
There is also speculation that the European Central Bank
may cut interest rates at its monthly meeting tomorrow (Nov 3rd)
which would be likely to weaken the Euro further.
Against the US Dollar, we have seen rates for sending money to America
generally do the opposite to the Euro. Sterling is stuck somewhat in the middle
of a currency see-saw, with a stronger Euro often meaning cheaper US Dollars,
and vice versa.
Generally the economic outlook for sterling is still
negative. Although this weekââ¬â¢s GDP figure was better than expected, 0.5% growth
is still not a great sign of economic recovery, and there may well be more
Quantitative Easing announced by the Bank of England next week, which is likely
to be bad news for the Pound. Manufacturing is still struggling, and
unemployment is still too high. The UK economy will also be affected by any
further problems in the Eurozone.
Whether you are buying or selling any currency in the
coming weeks an months, do ensure you alert a currency broker to your requirements
so as not to miss out on any opportunities to buy or sell. These large swings
in current exchange rates can literally make a difference of thousands of
pounds, and by dealing direct with a currency exchange company, you will also
be able to obtain better exchange rates for all your transfers than those
offered by typical banks.
