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Will Recent Sterling Strength Continue? (Matthew Vassallo)
Sterling has continued its positive run against the EUR during the early part of the trading week, despite not making a major impact against many of the other major currencies. Personally I did not expect such an improvement over the past couple of weeks and despite GBP/EUR rates breaching 1.40 again, I do not expect levels to climb back up to the highs we saw in the summer.
Whilst the trend remains positive, there is nothing tangible that is driving the Pound’s value up. For this reason it is likely this move is based more on negative connotations surrounding the Eurozone economy, rather than any overriding market confidence in the Pound. Due to the on-going instability within the Eurozone region, it is almost impossible for the EUR to make any sustainable impact against GBP and this is evident based on the recent market trend. It was only a couple of weeks ago that there was talk of the EUR putting pressure back on 1,30, only for the single currencies value to disintegrate almost in an instance.
The Pound did receive a boost following a run of positive economic data and this was true of yesterday, where UK Manufacturing data came in better than expected at 55.5. There was very little data of note released today but it will be interesting to hear European Central Bank (ECB) president Mario Draghi speak tonight, to see if he gives us any further insight into the Eurozone economy and the plans being instigated by the ECB to help drive the region’s economy forward.
Personally I would not be gambling on a market which is so uncertain and with the Pound relying on outside factors to drive it’s value higher, I would be tempted to lock in a position which is amongst the best we’ve seen over the past decade.
If you have an upcoming currency requirement and would like to be kept up to date with all the latest market movements, or simply wish to compare our award winning exchanger rates with your current provider, then please feel free to contact me directly on [email protected]
Source: http://www.poundsterlingforecast.com/2015/11/03/will-recent-sterling-strength-continue-matthew-vassallo/
