sterling x-change

H

henrietta

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I need to buy goods in the U.k.
could anyone make a forecast as to the sterling exchange rate V euro ,is it likely to fall or rise in the future.
 
Hi Henrietta - I wouldn't advise basing any signficant business decisions on any such forecasts you recieve here on this website. It is really just speculation - you might as well ask about next month's weather or next Saturday's racing at Leopardstown.
 
I don't think anyone can tell you what way any fx movement is going to go, and AAM is probably not the best forum for soliciting such opinions:

www.askaboutmoney.com/posting.html
There are many other places to get such opinions, 2 of which are :
www.fxcentre.com which sows forward rates for the GBP/ EUR rate or
which publishes further forecasts.
You say you need to buy goods, if it is a small amount than movements are unlikely to make a big difference. However, if the goods are of a significant value, perhaps a discussion with your bank about hedging a rate you are happy with may be useful?
 
tourist rates vs market rates

Thanks Statler - I will be converting a significant amount of sterling into Euro sometime in the next 6 months and the FX centre site looks useful. Although I realise that it is only opinion.

One other question, when following the exchange rate on the telly, you sometimes see fairly big differences between buy/sell tourist rates and the quoted currency exchange rates - which should I be watching for? How does all of this work?
 
Re: tourist rates vs market rates

FX centre quotes the mid-rate (between the buy and sell rates in the market). The tab beside this quotes the forward (fwd) rates that are currently traded in the market, representing market consensus on where the rates will be in 1, 3, 6 and 12 months time. Their "morning comment" etc. are purely opinions.

Tourist rates are set daily by banks and include a wide margin for movement in fx rates to ensure the bank makes a profit.

If you have a significant amount to convert from GBP to EUR the tourist rates should be of no interest, you should be looking for a rate as close to the mid-rate as possible. This can be obtained from an fx dealer in the treasury dept. of any of the banks etc. (through your usual contact or local branch). Also, don't be afraid to phone a number of them and to shop around.

I am not sure of the amounts involved, but I would caution against trying to time the conversion, even over a 6 month period. Investigate the possibility of hedging the transaction at a price you are happy with.
 
rates

Thanks again for the info Statler. I was looking at the forward rates purely out of curiosity. I wont have the funds to convert until the sale of a property goes through - so I wanted to see if the current 'comparatively' good rates were forecast to stay for the medium term.

The amount will be in excess of E200k so I will take your advice and shop around.
 
Re: rates

If it's a significant amount, the spread (margin) will be smaller. Also don't be afraid to ask them for their best offer on commission. Commission is worked out on a percentage basis usually. But for a large transaction you may be able to get a better deal of you ask.

The worst that can happen is they'll say no.

If you're dealing with a very very large transaction ask the person in the branch if they can get you a rate from a dealer. No point paying retail when buying in bulk.

-Rd
 
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