Be wary of waiting for further gains for the pound (Daniel Johnson)

Interest Rate hike by the BOE a knee jerk reaction

The recent gains for the pound last week were based on the predicted rate hike by the Bank of England (BOE) and tapering form the European Central Bank (ECB) along with the uncertainty surrounding the situation in Catalonia. The UK economy is shocking state considering where we could be had we not voted to leave the EU. Inflation is now at 3% and average wage growth is at 2.1%, In order to have a stable economy these figures need to be moving at a similar pace, they are not. Unemployment is being lauded as the best levels since the 70’s, but the data has only recently incorporated zero hour contracts. The rate hike from the BOE was a knee jerk reaction to the inflation problem and it is a coin flip as to whether it will have any impact.

There was very little justification for the hike and I am of the opinion we could be in for further losses for the pound against the Euro. Buoyancy levels have been between 1.08-1.15 since June,the last time we hit 1.15 was June. The highest we have seen the market in several months is 1.1450 and if you have a Euro requirement short to medium term it could be wise to move if the market moves close to 1.14 again.

In order for a significant rise Sterling value we need a stable government and clarity over Brexit, both of which I can’t see happening for the foreseeable future.

If you have a currency requirement I would be happy to assist. You need to have an experienced broker on board in order to take advantage of rates when a brief spike occurs, especially in the current climate. If you have a currency provider already in place I am prepared to perform a comparison against them. It will take minutes and could potentially save you hundreds or even thousands of pounds. I can be contacted at


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