We are in the final stage of compiling our currency forecasts for the months and year ahead. These are not our forecasts, I hasten to add, but an amalgation of forecasts from the leading banks. We don’t believe in making forecasts ourselves, and I’ll explain why in a moment.
But it is clear that signs of optimism are breaking out all over. We heard today that the Chinese economy appears to be growing at 6.4% year-on-year, shrugging off fears of President Trump’s trade war, while yesterday’s news was that the UK economy has more people in work – especially women – than ever before, shrugging off fears of you know what.
Speaking of which, British people planning a healthy retirement in the sun look to have another couple of years of freedom of movement to plan getting residency in an EU country before Brexit. Great news if you want to transfer a business or open an office in the EU27 too. (Smart has offices in Spain and Portugal, incidentally, as we do value our long-term relationships with clients moving abroad.)
The bank’s forecasts generally show optimism about the value of the pound, and it is here that I would like to inject a note of caution. At this time of year we normally see optimism about the pound, nearly always followed by disappointment in the summer. It is based on the idea that Brexit will be sorted out, but why anyone thinks that will happen, or why it would be a cause for optimism, is less clear.
The reason we don’t make our own forecasts is that we are not in the guessing businesses, we are in the risk management business. Our approach is simply this: by all means use that springtime optimism to make your plans and put your long-term dreams into action. But keep a cool head when it comes to your money and allow for the “rough winds” that will undoubtedly follow, if not next month then almost certainly at some point before you come to complete your transaction.
Please speak to your trader today about protecting your budget, on 020 7898 0541.
And have a happy and peaceful Easter. The UK is supposed to be enjoying warmer and sunnier weather than the Med, but I wouldn’t rely on that forecast either!