By Luke Dyson
Following on from last week for sterling, we saw a significant drop over the course of Friday afternoon against the Euro, dropping 0.45%. Some out of recent character movement given GBP/EUR has been relatively stable, although still within its current range bound market which is now pushing on to the 5 month mark. This recent price drop could be investors pricing in a defensive strategy ahead of the market data to come.
For the week ahead we have a potentially volatile one for sterling. The main two to watch out for are inflation data the 20th Sep, then swiftly followed by Bank of England’s interest rate decision the 21st.
Both of these announcements can have a significant impact on sterling strength depending on the outcomes.
Given where the GBP/EUR rate is at present, if you have any pending currency requirements, do consider the current rates. Looking back where the market has been for the year to date, sterling is still significantly stronger than where we started off at in January.
Leaving your currency requirement and seeing what the outcome of this data could be, will be something of a gamble, which could cost thousands of pounds more on a typical property purchase if the market doesn’t react the way you had hoped.
Some more key data to look out for this week; Tuesday 19th we have Bank of Canada inflation figures, then swiftly followed by the Fed’s interest rate decision on the 20th. Then later on in the week Bank of Japan’s interest rate decision on the 22nd.
Please get in touch with your currency consultant today to discuss your up and coming currency requirement, and get a strategy in place to limit your risk moving forward.