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At the time of writing, the Pound has crept up to 1.19 against the Euro providing the best opportunity to buy Euros this year. The question now is, will the trend continue?
It’s true that Brexit poses a huge risk to the UK economy, and as we’ve witnessed over the last 8 months, Sterling exchange rates remain vulnerable to political tensions. However, the focus for GBP/EUR appears to be shifting away from the Brexit vote and instead, Euro investors appear more concerned with the potential outcome of the French elections due to begin.
Market fears around the Brexit vote appear to be fading, and whilst the UK faces huge political and economic uncertainty in the weeks and months ahead, economic indicators do not appear to show any huge downturn in the UK economy, in fact, British exports appear to be on the rise.
The weaker Pound does appear to be cushioning the impact of the vote, and with inflation expected to rise beyond the Bank of England’s 2% target, markets are now gearing up for a potential interest rate hike.
Is now the best time to buy the Euro?
The Pound has enjoyed fresh highs against the Euro this year, and when you consider the lows of 1.10 last year, performing a £100,000 transfer today could pocket you €8000 more than the lows witnessed in November. With the UK expected to begin the process of exiting the EU in the coming weeks, making the most of these gains could be a worthwhile exercise. The concern is that once the UK hands its formal notice of withdrawal, a 2-year countdown will begin by which the UK must negotiation the terms of its exit, and judging by the opinions of many other EU states, this period is likely to be difficult and complicated.
Now could be a good time to buy Euros, as when the UK pulls the trigger on Article 50 the Pound may weaken as uncertainty kicks in.
If you need to perform a transfer in the coming weeks, there are other options available in the event of Sterling downturn. Our team of dedicated currency experts can talk to you through the different contract options and provide you with a competitive rate of exchange that will beat any high-street bank.
There is no harm in giving us a call, signing up is free and you will be assigned your own account manager who will walk you through the necessary steps to completing your transfer. Call us on 01494 725353 if you plan on buying Euros in 2017 and see how much we could save you on a currency transfer.