Will GBPEUR just keep on rising?

The GBPEUR exchange rate has been rising and rising for the last month hitting 1.41937 at the pea, that is 8 1/2 cent higher than the low of 1.3356 on the 12th October. If you are buying £200,000 worth of Euros today you are getting an extra €15,580! This remarkable movement has been very much against the grain of opinion concerning sterling and many commentators actually had GBPEUR falling to 1.30 by the year end based on poor performance of the pound with a very low likelihood of an interest rate rise for the UK. Despite the forecast for the UK to raise interest rates being pushed further (and weakening the pound last week) it is the poor performance of the Eurozone and suspected future economic policies that is worrying investors.

The Eurozone is contemplating further Quantitative  Easing (QE) which will weaken the Euro, they have also openly discussed the prospect of an interest rate cut. Both these events could serve to weaken the Euro and the mere prospect of this happening down the line has set the Euro on the back foot. Tomorrow we have an important release containing UK Unemployment data, this has been one of the stronger areas for the UK in recent years and could see sterling finds some favour.

I feel on balance there is a danger that for anyone selling Euros that they might come unstuck in the future, nothing is ever certain on exchange rates but there is a reason we have had such a big market movement. Whilst there could be a relief rally of some description, I feel it likely GBPEUR will climb higher in the future. To get the latest updates and forecasts on the market please email me Jonathan on jmw@currencies.co.uk including some contact details and a brief description of your situation.

For more news on foreign exchange rates and to request a free no-obligation quote visit www.currencies.co.uk