Weekly Currency Note: 23rd December 2005
Dear Reader,
Weekly currency note: 23rd December 2005
Overview
Not a good week for sterling losing ground against both the Euro
and the US$. Best to enjoy the festivities and wait to see what
2006 brings.
Great uncertainty in the next few months as to what will happen
to sterling. As we know all is not rosy in the UK but the US and
Euro land are hardly pillars of economic virtue. However, it has
to be noted that the great German industrial machine seems to
gathering speed which increases the likelihood of interest rate
rises in Euro land.
The Smart team wishes you a wonderful Christmas and the very best
for 2006.
Why is currency management so important?
Whatever does happen there are always better days to buy or sell
currencies. You just need to make sure you know what rate you want
and that you are in a position to do it quickly when the
opportunity presents itself.
Open an account today by calling me on 0870 285 0364 or fill out
our online quotation form
at: http://www.smartcurrencyexchange.com/smartquotation.htm
The Euro vs. the £
The Euro started the week at 1.476ish and is currently 1.460ish.
Most of this move had happened in the last couple of days. Given
the current trading range it may be a good time to sell Euros.
There has been no clear trend in the Euro/sterling exchange rate
for the last six months – just a broad trading range of 1.44 to 1.50.
This range has tightened in the last couple of months to 1.46 to 1.485.
We are now towards the bottom end of this range.
Just so you know, currencies such as the Cypriot £ and the Hungarian
Forint, which are planning to move to the Euro in due course, are closely
aligned to the Euro. Therefore they tend to track the Euro. Sometimes
they do have a life of their own but they do tend to come
back into line sooner rather than later.
If you need to BUY or SELL EUROS now is a good time to discuss your options,
so call me on 0870 285 0364 or fill out our online quotation form
at: http://www.smartcurrencyexchange.com/smartquotation.htm
The US$ vs. the £
Last week it was 1.772.It is now 1.730. Shows how quickly momentum can
shift. May be soon back at 1.71.
Interest rate rises are supposedly coming to an end. However, inflation
is still of concern which may mean that the rise has still further to go
than expected. But, we still have to be wary as the twin deficits of budget
and the balance of payments [which is still growing] as these mean that
the USA is very dependent on external parties buying dollars.
Momentum, purchasing parity and rising interest rates support my
inclination for further strengthening in the US$ but I could be very wrong.
The Dirham and the US$ are closely tied. Therefore as the US$ moves so
does the Dirham.
If you need to BUY or SELL USD, call me on 0870 285 0364 to discuss your
options or fill out our online quotation form
at: http://www.smartcurrencyexchange.com/smartquotation.htm
The Aus $ vs. the £
Last week it was 2.383, today 2.38oish. Overall the Aus $ still
appears to be in a strengthening trend and this may represent a
buying opportunity.
Will it break through 2.27 in the first quarter, we wait to see.
If you need to BUY or SELL Australian Dollars, call me on 0870 285 0364 to
discuss your options or or fill out our online quotation form
at: http://www.smartcurrencyexchange.com/smartquotation.htm
The Can$ vs. the £
The Can$ was 2.05 at the start of the week and 2.02 at the end.
The Canadian $ continues to be very strong.
The Canadian economy is booming. Its commodities are in much demand. They
also have a positive balance of payments as opposed to the USA and Australia.
We wait to see if the Canadian $ can strengthen further but history would
still favour a return to 2.20 plus but timescales are difficult if not
impossible to estimate!
If you need to BUY or SELL Canadian Dollars, call me on 0870 285 0364 to
discuss your options or fill out our online quotation form
at: http://www.smartcurrencyexchange.com/smartquotation.htm
If you would like to discuss a currency not mentioned in this note, the
latest movements, secure an exchange rate or discuss your particular
situation, please feel free to contact me on 0870 285 0364
Lastly, were always working to improve the service provided by
Smart Currency Exchange, so if I can produce information in a better
format or make it easier to understand, of if you want me to clarify
what a particular term means, please send me your questions, suggestions
and/or comments to Charles@SmartCurrencyExchange.com
Think Smart,
Charles Purdy
Director
Phone: 0870 285 0364
Fax: 0870 285 0365
http://www.SmartCurrencyExchange.com
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Disclaimer
As ever these are my musing as to how I see the various markets going.
They should not be taken as fact. The market does what it wants to do.
I have no crystal ball and as ever I recommend that if an exchange rate
works for your budget then dont try and wait for an even better
exchange rate, as Murphys Law says the rate will go against you and
cause you maximum pain!
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