The pound has dropped to its lowest level for six weeks against the euro today (and its lowest against the US dollar since the spring).
The reason was the all-important inflation data. “All important” that is, because of how it might guide the interest rate decision from the Bank of England (BoE) tomorrow lunchtime, and the effect that can have on exchange rates.
So, this morning’s drop could be the start of a longer-term decline for the pound, in which case it may be wise to fix your rate with a call to your trader on 020 7898 0541.
On the hand, it might be a blip and those selling euros to buy pounds should secure their best rate since August 11th.
Either way, locking in your rate will give you certainty, and that is a commodity in short supply right now.
This morning’s inflation figure was the start of a frenetic period for those things – data and decisions – that govern your exchange rate. This evening we have the American interest rate decision, which can have an outsize effect on UK business and the stock markets. Tomorrow there is the UK’s own interest rate decision. On Friday morning there is the GfK Consumer Confidence reading as well as retail sales for the UK. And to round it all off, a reading of business plans and optimism too, across the globe, with the Purchasing Manager’s Index (PMI).
By this time next week your pounds when converted to euros could be worth significantly less than they are now, so if that would be a worry, do call your trader today and we can find a solution.
