With the prospects of Greece leaving the Eurozone, after increasing pressure from the European Central Bank, what does the future hold for the euro?
Well nobody has a crystal ball, but if we were to face a Greece exit or “Grexit” as it has become known, this could have a huge impact on the markets and send the euro tumbling! German Chancellor Angela Merkel is remaining defiant, insisting that a Grexit would not destabilise the Eurozone, and to some extent, certainly from a currency point of view, she is right – a lot of the uncertainty is already priced in which we can see from the recent fall in the single currency.
How would this affect sterling?
However, it’s not just the euro under pressure at the moment – the pound is also out of favour with investors and the next two weeks leading up to the UK elections on 7th May will be a testing time. Another hung parliament will weaken the currency and we could see GBP/USD continuing its downtrend – great for US investors buying in France or the UK but not so much the other way round!
Five years ago one euro would buy $1.34 – today it is only worth $1.08. Given the expected increased volatility in the currency markets in the coming weeks, now is certainly an important time to seek advice from the money experts.
GBP/EUR is currently at €1.40 to the pound – a level not seen since before the 2008 crisis when it came perilously close to reaching parity (£1 = €1).
Essentially this means that purchasing a property now, compared to December 2008 is 40% cheaper.
Using banks to transfer currency
Banks are an expensive way of transferring funds and they can charge hefty fees or take a large commission. Additionally, and importantly, they tend to provide just one rate for the entire day, and we all know that rates move throughout the day. We don’t even need to come on to the challenge of being able to speak to someone on the phone…That’s why choosing a money exchange specialist makes better sense.
Here’s a quick look at what you should be considering:
A forward rate – Allows you to capitalise on a current favourable rate even if you don’t need the currency straight away. (Imagine those happy Brits who fixed at €1.30 in October 2008!)
A market order – Allows you to target a specific range if you are not needing currency urgently – means your personal trader does all the work for you to help you buy at the best time.
Regular payment plan – Allows you to set a rate on a monthly basis which is direct debited from your UK account straight into your French account – ideal for mortgage and pension transfers.
This article was written for us by Tanya from Moneycorp – Our recommended currency exchange experts.
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