The skies brightened for the pound on Tuesday and helped brush off the blues from what has otherwise been a dark and dreary February.
GBP/EUR continues to trade at around its highest in a month and sits within touching distance of its highest this year. That’s good news for overseas property buyers but we don’t need to remind you just how fickle currency markets are, plus how quickly unexpected events can turn things on their head.
To take advantage of the pound’s strength, secure today’s GBP/EUR rate by calling your account manager on 020 8003 4915.
Sterling was able to make hay after a rare stumble from across the Atlantic. The so-called “Trump trades” – speculative bets that the American economy would best its rivals in the short term – have underperformed since the start of the year and fears are growing that trade tariffs will stunt the economy.
Today’s economic calendar is dominated by US inflation data. Thursday presents a clear risk to the pound in the form of GDP (gross domestic product) growth data. Economists expect GDP to have recorded zero growth in the fourth quarter of last year but sterling is likely to be volatile regardless of the read.
On the geopolitical stage, fears are mounting that the delicate ceasefire in Gaza between Hamas and Israel might crumble. Israeli prime minister Benjamin Netanyahu warned that hostilities would resume unless Hamas freed more hostages by this weekend, reflecting the sharper tone adopted by Trump in recent days. Renewed fears of war are likely to spark more safe-haven flows (towards common holdings like the US dollar) in currency markets.
In UK property news, investment firm UOWN unveiled a new report that predicted house prices would rise faster in the North of England than the South over the next five years. Higher stamp duties are expected to push buyers towards cheaper properties and away from more expensive homes in the South East.
