The pound’s sorrows are coming not as single spies, but in battalions, to mangle Shakespeare a little. Sterling’s precipitous fall started yesterday and has continued overnight and this morning, as bad news continues to arrive.
You might have missed it, but the latest problem for sterling was a press conference from Scotland’s First Minister Nicola Sturgeon outlining a plan for a new referendum on Scottish independence.
The pound was already suffering the ill-effects of the Brexit referendum as the risk of a trade dispute with the EU grows over the Northern Ireland protocols. Added to this are the central banks’ attempts to put the inflation genie back in the bottle this week. That’s not just the Bank of England’s problem – both the US Federal Reserve and the ECB have the same problem. While the US is likely to raise interest rates aggressively today, perhaps by 0.75%, the Bank of England seems to be risking a slower increase, probably of 0.25%. That is likely to depress the pound further, although there are no guarantees.
So these are tough times for anyone committed to buying a property abroad in the near future, and who didn’t take the precaution of locking in their rate immediately on agreeing a price – or before. You only have to go back to mid-April to see sterling at €1.20, but it’s now 5% below that.
It’s also problematic for anyone making an application for a ‘non-lucrative visa’, which is what most retirees opt for, and who needs to show a certain level of income. In Spain, for example, you need an income or savings of nearly €28,000 per year. Do check Your Overseas Home for useful information like that.
If the rate today still allows you to fulfil your plans abroad, why not lock it in? That way the money for your purchase or life abroad is secured.
Do that with a call to your trader on 020 8003 4915.
