What a difference a day makes. Yesterday morning sterling reached another 13-month high against the euro but has since lost nearly 2%.
A €200,000 property thus became nearly £3,000 more expensive in the space of 24 hours.
You might think that the pound would only drop so far for a compelling reason, such as an interest rate decrease or a piece of shockingly negative economic or political news. But there was nothing to shock the currency markets yesterday. Or that the general mood might have turned against sterling, but there was no indication of a more general reversal of fortune for the UK either. Its competitive advantage over rival economies, based on our vaccine rollout, does not appear to have run out of road since Covid hospitalisations continue to drop at an astonishing level while others’ are rising.
It all goes to show that the currency markets can turn on almost nothing. Anyone who makes a business decision or significant transaction based on rumour or hope or previous history is taking a very serious risk indeed.
Nevertheless, we are still at a significantly higher rate than at any point in the previous 12 months before this March and well above the five-year average, as shops prepare to re-open in five days and hospitality to open for outdoor service.
So, if you would like to consider locking in this rate, offering you that most valuable of commodities, certainty, do call your trader on 020 8003 4915.
