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GBP/EUR best exchange rates (Joshua Privett)
GBP/EUR exchange rates were swinging wildly last night, in one of the most volatile periods on the currency markets since the start of this year, including the dire periods when a ‘Grexit’ seemed like a possibility.
The most amazing part was that all of this movement was largely confined to a matter of minutes before and after 18:00 yesterday evening.
The cause for this beneficial movement for Euro buyers, which saw GBP/EUR exchange rates breach into the high 1.39’s once more, was actually due to events on the other side of the Atlantic.
The US FED were announcing their decision on whether to increase the base interest rate level for the US economy, as well as releasing their monthly monetary policy statement. While there was no change in the base rate, the statement itself did hint that a rate hike may occur in December.
Why does this matter for GBP/EUR exchange rates?
The USD/EUR is the most traded currency pairing in the world. As such, when the value of one changes, the rule of thumb is that the opposite effect occurs in the other. In this instance, positive news for the US saw capital fly from the Euro into the Dollar, causing USD strength and Euro weakness.
The reason why the change in exchange rates was so dramatic and confined to such a short period of time is because interest rates have not been raised in a major western economy since the financial crisis of 2007/8. Being the first to do so would be a monumental event, and market reactions echo the significance of this should it take place.
GBP/EUR exchange rates are now at their best purchasing levels since August. However, as this sudden rate movement is nothing to do with events in either the UK or the Eurozone, these are very unlikely to be a permanent feature on the markets.
Rates are already begin to correct as Euro buyers scramble to buy at these current highs while the Euro is artificially undervalued. GBP/EUR then falls due to demand for the Euro rising, which is why rates have already fallen by over half a cent.
I strongly recommend that anyone with Euros to buy before the end of this year should contact me on 01494 787 478 and ask the reception for Joshua to discuss a strategy for your transfer and maximise your Euro return. I can also supply a competitive quote for your exchange should you wish, and I have never had a problem beating rates offered elsewhere. [email protected]
Source: http://www.eurorateforecast.com/2015/10/29/gbpeur-best-exchange-rates-joshua-privett/
