February was a fairly quiet month for the GBP/EUR exchange rate but March could be different with the on-going debate over the Brexit Bill and the imminent triggering of Article 50
Compared to the rollercoaster ride anyone interested in French property, and therefore the euro, experienced in January, February was a gentle drive. The difference between the high and the low of the month for anyone buying euros was only a couple of cents, in stark contrast to January, where six-cent movements were recorded.
Although muted, these movements can make a large difference to anyone buying a foreign property. Just over the past month, a £200,000 transfer could achieve an additional €4,000 more on a well-timed transfer. Get in touch with a specialist broker or get a quote here to see how much we could save you.
The pound, the Brexit Bill and Article 50
Theresa May originally set a deadline for the end of March to trigger Article 50. Currently, as this article is being written, the House of Lords are deliberating on whether to add amendments to what was originally a fairly simple Bill – granting Theresa May and the Government the right to invoke Article 50 and negotiate with Europe on the UK’s behalf.
However, the Lords are looking at a few key areas to provide guarantees ahead of negotiations. Currently, the Lords have already sent the Bill back to the Commons with an Amendment for them to vote on – ensuring the rights of EU citizens that already reside in the UK.
Whilst this on-going back and forth continues between the House of Commons and the House of Lords, to some degree, you can expect exchange rates to remain range bound as seen over the past four weeks.
But there has been a glimpse of life for the pound. Mentions and murmurs of guaranteeing a vote on any final deal reached between the Government and the Eurozone, has created greater confidence in the pound, given that it makes it more likely a deal will be struck in the interests of the UK. It also means Parliament will be kept in the loop as negotiations progress, so markets don’t feel that they will be ‘kept in the dark’ over the next two years.
How best to approach your Euro purchase as we edge closer to Article 50 being enacted
This current landscape for pound to euro exchange rates is built on a fluid political climate, where sudden turns can occur at any moment. It may be prudent to keep an eye on exchange rates at regular intervals as we approach the final hurdles to Article 50. You can keep track of live interbank exchange rates here.
Not to mention the fact that the spotlight is shifting towards the Eurozone to some degree, with the Dutch elections coming up this month and the same in France, both with the potential for an anti-EU candidate to take power.
In this hypersensitive atmosphere where trends can change dramatically in a short period, the usefulness of a contact in the currency markets to keep you informed on movements is at an all-time high. Rates change by the second, and swing multiple times throughout the day. This is not a market where it is sensible to simply check your phone at the end of a long day of work.
A currency broker is in a position to keep you informed to avoid being caught unaware. Furthermore, there are additional options on how to approach your purchase which are not traditionally available from banks for retail customers.
A popular option available through a currency exchange brokerage is the ability to ‘pre-book’ your currency at the levels on any given day, to cover that entire three month period, and more if need be. This is through a forward contract, where a small deposit allows you to move forward towards the completion knowing exactly what your euros will cost in sterling.
More about Foreign Currency Direct
Foreign Currency Direct is a leading UK currency exchange brokerage. Established in 2000, Foreign Currency Direct is dedicated to offering the highest levels of customer service, that’s why each client is assigned a dedicated currency broker, someone who understands your unique situation and works tirelessly to gain the maximum value for every currency transfer.
Learn more about Foreign Currency Direct plc at: www.currencies.co.uk