Foreign currency exchange

Eurozone woes boost Sterling, making it cheaper for Britons to buy a home and live in Spain

By Luke Trevail of TorFX

The Eurozone debt crisis, coupled with changes of government in the region, have shaken the markets throughout May, after a good April for Sterling.

The Pound has benefitted as a result, up 3.4pc in a month, and 7.5pc in 6 months, despite the UK being in a recession. The threat of the Euro weakening further is a real possibility.

The spike upwards last week provided Euro buyers with the best prices since late 2008, whilst sellers of the single currency take the pain.

Should Greece leave the Eurozone problems will still remain, as other countries like Spain may need help. The Euro will stay under pressure unless and until Eurozone authorities take action on a scale hitherto unseen.

In the meantime, British house-hunters in Spain with cash in Sterling will find themselves in an increasingly strong position.

Do you need to buy or sell foreign currency? Click here for a free quote and advice from specialist currency brokers TorFX.

The un-seasonally nice weather in the UK had prompted the market to warm to comments from George Osborne and the UK Budget earlier in March leading to the pound rising to above €1.20, this was before the familiar chill of more bad news came back to stop the pound in its tracks.

By Luke Trevail of TorFX

A period of positive trading for Sterling came to an abrupt end as shock news on Wednesday morning showed a contraction in the UK economy that was greater than predicted weighing heavily on the fortunes of Sterling. The two previous estimates for the gross domestic product in Q4 2010 were surprised that the actually figure showed that the economy shrank by 0.3% rather than 0.2% first thought, and factored into the market.

It is hoped that a pickup in activity will be posted for Q1 of this year, preliminary figures are to be released this time next month, but the hand that was dealt yesterday saw a lot of Sterling’s good work crumble away following the announcement as it fell by just over 1% against the euro which is the biggest loss on a single day that we have seen in five weeks.

Further bad news in the form of Nationwide house price data, which posted an unexpected fall have underlined the problems that the UK is facing to try and kick start the economy and get the protracted ‘recovery’ a start in earnest.

For Sterling sellers, the last few days have stunted hopes of an immediate break above key levels on the euro which, as mentioned has fallen away by around 1%. Market participants can see however that with volatility entering the market once more we are likely going to see some potentially very good, but also some very bad days moving forward

News from the eurozone crisis seems to have gone suspiciously quiet through March, but the threat of this being a sleeping giant for me is absolutely something to be aware of. Talk of Portugal, Spain, Italy and Ireland feeling the same pressure that Greece did, and arguably still are experiencing will likely weigh on the European Central bank over the coming weeks. The once booming housing market in Europe is stuttering at best and as we enter the Spring, the focus on tourism and the money generated to the region will be key on whether we see more countries defaulting and seeking support from Germany, France and others.

If you have the pound to sell you can do very well still by entering into the market around €1.18, but with the Olympics around the corner and what’s expected to be a huge cash injection into the UK just when they need it most, decent prices for Euro sellers are expected not to last. Anyone in the position of wanting to repatriate funds to the UK could do well to cover at least some of their requirement soon.

Do you need to buy or sell foreign currency? Click here for a free quote and advice from specialist currency brokers TorFX.

The euro picture has remained sketchy at best over the last couple of weeks, with the currency markets awaiting a more definite stance on Europe so it can determine where to move and shore-up some stability.

By Luke Trevail of TorFX

The Greek bailout limped to a decision throughout February, but the severe austerity measures undertaken by the Greek government haven’t proved popular and their ability to repay the loan will now be bought into focus.

As spring begins, news about the UK economy we hope will allow the pound to bounce back above the €1.20 level, although the UK budget on 21st March will prove pivotal in how sterling favours.

Above all fundamentals, however, is the simmering problem of the Euro Debt Crisis, with the ‘bail-out’ measures like what has been seen with Greece being described as putting a colander underneath the problem, only with smaller holes. The leaks will still appear, and are likely to continue to flow.

Economic news from Spain is relatively quiet, with housing taking a welcome boost in February. Many European countries are being accused as burying their heads in the sand regarding their own problems however as the Greek issue grabs the headlines.

At the euro summit earlier in February many finance ministers were visibly pandering to France and Germany, possibly with a view to get a leg-up off a mate if they need to go cap in hand later this year?

Speculation of course remains rife, and volatility in the currency markets can affect any purchase that you are looking to do. Buying euros remains just below €1.20, so within 1% of the highest rate we’ve seen for 15 months. Sellers of euros to the pound however are well placed to try and cover at least some of their requirement soon as the issue in Europe seems close to boiling over.

Do you need to buy or sell foreign currency? Click here for a free quote and advice from specialist currency brokers TorFX.

The euro picture has remained sketchy at best over the last couple of weeks, with the currency markets awaiting a more definite stance on Europe so it can determine where to move and shore-up some stability.

By Luke Trevail of TorFX

The Greek bailout limped to a decision throughout February, but the severe austerity measures undertaken by the Greek government haven’t proved popular and their ability to repay the loan will now be bought into focus.

As spring begins, news about the UK economy we hope will allow the pound to bounce back above the €1.20 level, although the UK budget on 21st March will prove pivotal in how sterling favours.

Above all fundamentals, however, is the simmering problem of the Euro Debt Crisis, with the ‘bail-out’ measures like what has been seen with Greece being described as putting a colander underneath the problem, only with smaller holes. The leaks will still appear, and are likely to continue to flow.

Economic news from Spain is relatively quiet, with housing taking a welcome boost in February. Many European countries are being accused as burying their heads in the sand regarding their own problems however as the Greek issue grabs the headlines.

At the euro summit earlier in February many finance ministers were visibly pandering to France and Germany, possibly with a view to get a leg-up off a mate if they need to go cap in hand later this year?

Speculation of course remains rife, and volatility in the currency markets can affect any purchase that you are looking to do. Buying euros remains just below €1.20, so within 1% of the highest rate we’ve seen for 15 months. Sellers of euros to the pound however are well placed to try and cover at least some of their requirement soon as the issue in Europe seems close to boiling over.

Do you need to buy or sell foreign currency? Click here for a free quote and advice from specialist currency brokers TorFX.

The Euro remains vulnerable as the debate over Greece’s next bailout package continues, and rumblings of further problems likely for the wider economy over the coming weeks.

By Luke Trevail of TorFX

Exchange rates for euro buyers have come down a little as UK economic fundamentals over the last 3 weeks have been continually poor which provides a great opportunity for those euro sellers who’ve been waiting for anything less than €1.20 to off load some euros following investment maturity or property sales.

For euro buyers, it’s likely to only be a matter of time before we see some more fragility of the single currency as the debt crisis problem will likely worsen. Indeed, this morning Germany posted negative growth for the 4th Quarter of 2011 as the GDP figures showed a 0.2% contraction attributed largely to the lack of demand in exports.

The picture for the pound remains blurred at best, with rates against the most actively traded currencies being fantastic on one hand as we post rates near a 14-month high versus the Euro, and horrific on the other as GBP vs. Australian and New Zealand Dollars plunging to the worst rates in over 20 years.

Choppy trading recentyl0 has been undermined by the credit agency Moody’s warning this week that it could cut the UK’s triple A credit rating as problems persist for sterling, particularly the threat of falling into another recession.

Trading advice for any currency buyers or sellers is to be warned of continued volatility with some good euro prices still available and with China issuing support for the monetary measures recently taken by the ECB.

Do you need to buy or sell foreign currency? Click here for a free quote and advice from specialist currency brokers TorFX.

The outlook for the euro looks uncertain as the debt crisis continues to throw up all manner of different issues for the single currency to contend with.

By Luke Trevail of TorFX

The longer term picture is unclear, but throughout January the Merkel & Sarkozy ‘coalition’ cemented itself as the leading factor in deciding, influencing and potentially commanding what direction the euro-zone takes from here.

This outcome is largely yet to be determined but from a currency point-of-view the markets do not like this uncertainty, with only a glut of weak UK fundamentals keeping rates against the pound below €1.20 (0.833) this last couple of weeks.

January saw UK economic growth shrink by more than expected throughout quarter four of 2011, posting a -0,2% contraction. Two quarters of negative growth to an economy is the definition of a recession and it’s this rather worrying banana skin that’s keeping the pound at bay for now.

It’s fair to assume however that for anyone who is looking to buy the euro over the coming month will potentially get a better rate than where we are now as the euro will likely continue to suffer from ongoing difficulties that may drive the market higher.

This should sound as a warning for anyone who is sat with euros and wanting to get these moved back to the UK as the threat of a move up towards €1.25 could be on the cards.

Using a specialist FX broker such as TORfx will allow you benefit from trading options that are not available through the bank such a limit and stop orders which are designed to achieve you a better rate than what’s currently available while protecting you against any adverse moves along with forward buying options which allows you to secure a rate based on where the market is now and pay your money to us for ongoing exchange at a date in the future.

As we bid farewell to January, the next few weeks will prove pivotal in deciding how the fall out of the Euro Debt Crisis will affect the currency markets. Volatility will be key, so the advice to keep abreast with the current market, rather than lovingly remember rates of years gone by is, as ever important in determining what worth your money can command.

Do you need to buy or sell foreign currency? Click here for a free quote from specialist currency brokers TorFX.

The outlook for the euro looks uncertain as the debt crisis continues to throw up all manner of different issues for the single currency to contend with.

By Luke Trevail of TorFX

The longer term picture is unclear, but throughout January the Merkel & Sarkozy ‘coalition’ cemented itself as the leading factor in deciding, influencing and potentially commanding what direction the euro-zone takes from here.

This outcome is largely yet to be determined but from a currency point-of-view the markets do not like this uncertainty, with only a glut of weak UK fundamentals keeping rates against the pound below €1.20 (0.833) this last couple of weeks.

January saw UK economic growth shrink by more than expected throughout quarter four of 2011, posting a -0,2% contraction. Two quarters of negative growth to an economy is the definition of a recession and it’s this rather worrying banana skin that’s keeping the pound at bay for now.

It’s fair to assume however that for anyone who is looking to buy the euro over the coming month will potentially get a better rate than where we are now as the euro will likely continue to suffer from ongoing difficulties that may drive the market higher.

This should sound as a warning for anyone who is sat with euros and wanting to get these moved back to the UK as the threat of a move up towards €1.25 could be on the cards.

Using a specialist FX broker such as TORfx will allow you benefit from trading options that are not available through the bank such a limit and stop orders which are designed to achieve you a better rate than what’s currently available while protecting you against any adverse moves along with forward buying options which allows you to secure a rate based on where the market is now and pay your money to us for ongoing exchange at a date in the future.

As we bid farewell to January, the next few weeks will prove pivotal in deciding how the fall out of the Euro Debt Crisis will affect the currency markets. Volatility will be key, so the advice to keep abreast with the current market, rather than lovingly remember rates of years gone by is, as ever important in determining what worth your money can command.

Do you need to buy or sell foreign currency? Click here for a free quote from specialist currency brokers TorFX.

A weaker Euro means fewer Pounds for British vendors who repatriat their funds to the UK. Using a forward contract might help in some cases.

By Luke Trevail of TorFX

Happy New Year!

Or perhaps not for the Euro zone as we continue to see the proverbial nails being readied for the coffin that contains the single currencies’ woes.

Not chirpy, I know, but for many investors and property owners in Spain it’s time to look at the bigger picture, which doesn’t paint a pretty scene as the hang-over continues into 2012.

The second half of last year revealed a number of detrimental factors that have hurt the Euro zone: worrying decline in stocks, increase in unemployment, Governments finally pulling their heads out of the sand and recognising the problems within their own countries have all contributed to the crisis, which left people asking whether the single currency will even survive a year.

It is a fair assumption that the Euro zone debt crisis will remain the central focus of markets going into the New Year, so further weakening of the Euro is expected.

The outcome of the EU Summit last month did little to support the currency, with the outlining of plans to work towards greater fiscal integration in the euro zone failing to provide any comfort to the market as GBP-EUR pushed the €1.20 (0.833) level, and some forecasting €1.25 (0.8) by the end of February.

So the Euro could well continue to fall, in which case now might be a good time to sell it, or get a forward contract to do so if you are not yet ready (for example, if you are in the process of selling a property in Spain).

For example, if you wanted to change Eurso into Pounds in June last year, when one Pound cost 1.11 Euros, but didn’t have access to the Euros until December, a foward contract could have saved you £6,992.21.

A forward buying option is easy to set up

Firstly, you agree a rate of exchange for the amount of Euros that you are looking to sell and give a date that you know that the funds will be available before (bond maturity, or date of expected house completion for example).

A 10% deposit is needed within a few days of agreeing the rate and you can then relax and not be affected by any market movement, and can get your money at any stage at the fixed rate and all you need to do is send over the Euros when you have them before the end of forward contract.

Do you need to buy or sell foreign currency? Click here for a free quote from specialist currency brokers TorFX.

If you have savings in Euros, now might be a good time to get back into Pounds

In collaboration with TorFX

The Euro Debt crisis continues to make the headlines as the single currency struggles to claw back any gains following the damaging reports and data released from Italy, Greece, Spain, Portugal, Belgium – the list goes on.

With France at risk of losing its ‘triple A’ credit rating and rumours of Greece withdrawing all together from the euro-zone, continued weakening of the euro currency is likely.

Brief respite came last weekend after reports in an Italian newspaper suggested that the IMF was preparing an aid package for Italy which, if true, could give some breathing space over the next 18 months as €600 billion is to be made available.

Deeper cracks in the Euro are expected, however, over the coming weeks as the next European summit is due at the beginning of December, this follows the news last week that Belgium, Portugal and Spain had their credit rating slashed and further sufferings from the European Debt Crisis were felt in Germany as they unsuccessfully tried to auction a quantity of bonds.

Still time to sell Euros below €1.20, but for how long?

Market buyers are looking to off load the Euro in a bid to protect themselves against further falls, putting more downward pressure on the Euro. That should lead to a stronger Pound against the Euro, as the pound enjoys somewhat of a recovery due partly to a shift in focus away from its own woes. But anyone buying Sterling today will still get rates of below €1.20 (0.8333) so there is still a window of opportunity for buyers.

Any Spanish residents who are looking at repatriating funds will be well placed to move sooner rather than later as it seems that the historically resilient Euro is showing some clear signs of weakness the likes of which, thus far in the world recession we haven’t seen before.

Many market analysts are predicting that 2012 will see a significant shift in the fortunes of the Euro, with €1.25 being suggested as an average mid-market price throughout next year.

This has important implications for British vendors hoping to repatriate equity to the UK after selling their homes in Spain. If the Euro does weaken as expected against the Pound, it might be better to reduce asking prices now to make a sale, rather than wait and get caught between a falling Euro and falling property prices.

British house-hunters in Spain in better position

The other side of the coin is increasingly cheap Euros for those with Pounds Sterling. The Euro weakness makes a refreshing change for potential buyers in Spain, and the days of €1.12 to the Pound (or below) are likely gone for the foreseeable future. If property prices continue falling, and the Euro loses ground to the Pound, Spanish property will look increasingly attractive to British buyers with funds in Sterling.

But volatility (big short-term swings) will play a huge factor in the markets moving forward, so be sure to consult a specialist currency broker before you buy or sell foreign currency.

Do you need to buy or sell foreign currency? Get a free quote from specialist currency brokers TorFX. I use them myself.

Click here for a free quote.