# Euro-Sterling exchange rate - predictions please



## thejuggler

Whats the likely outlook for the euro sterling exchange rate over the next few months?  I wish to make a purchase in sterling but am prepared to wait if the euro is likely to strengthen against the pound.

If as widely expected the ECB announce an interest rate hike this week with the possibility of another before the end of the year will this make the euro stronger or is this view too simplistic?


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## jimbob1234

thats not too simplistic. if they raise rates on thursday then the euro will burst 1.60 against the dollar and also up against  the pound (less so). the uk arent goign to cut rates either so the euros rise against it will be limited in my opinion.


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## csirl

Parity within 2 years.


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## jimbob1234

thats a possibility


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## jpd

Exchange rate predictions are notoriously difficult - especially for experts! 

If you risk adverse, then convert now and fix your costs; if not, then the rate in a few months could go up, down or stay the same.


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## p45

Euro certainly worth 83p by Christmas.


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## z106

WIth the uk housing market only going one way, then i too predict a continuing slide with the pound.


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## joejoe

qwertyuiop said:


> WIth the uk housing market only going one way, then i too predict a continuing slide with the pound.


 
How long will that last, the decline in the housing market? and will it mean parity, in your opinion of course.

Joejoe


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## jimbob1234

its impossible to say how long the decline in the housing market will last. i think we are in for a global recession. some countries will be worse than others. the UK wont be too bad


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## Sunny

jimbob1234 said:


> its impossible to say how long the decline in the housing market will last. i think we are in for a global recession. some countries will be worse than others. the UK wont be too bad


 
Why do you say the UK won't be too bad?


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## z109

It's very difficult to say how long the decline in the housing market will last, but you should bet on at least four years from peak. I also think we are in for a global recession, but different portions of the world economy will go into recession at different times leading to a long-drawn out affair of sub-par growth. Some countries will be hit worse than others. The UK will be very bad. They have a currency that is under pressure, therefore their import costs will rise. North Sea oil output is in decline so high oil prices won't help them. International financial management is in chaos, so London will not provide the engine that it has in the past. The UK consumer is hugely indebted so there is no capability to spend their way out. UK government finances are under pressure already with the downturn barely started.


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## thejuggler

No impact on the sterling rate yet anyway


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## csirl

> Why do you say the UK won't be too bad?


 
Have you been to the UK recently? I suggest you visit somewhere north of the Watford gap and talk to the locals. Then try telling us that the UK wont be too bad - its all ready in serious trouble & heading for the second world.


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## Sunny

csirl said:


> Have you been to the UK recently? I suggest you visit somewhere north of the Watford gap and talk to the locals. Then try telling us that the UK wont be too bad - its all ready in serious trouble & heading for the second world.


 
What are you talking about? I agree with you and thats why I was asking the other poster why he didn't think the UK would be too bad.


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## csirl

Sorry Sunny - my mistake.


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## Sunny

csirl said:


> Sorry Sunny - my mistake.


 
No worries. I don't know how anyone can be anything other than very concerned about the UK. They are in a much worse state than us so I am not sure why the other poster thought the UK would escape the worst of it.


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## Car Mad

p45 said:


> Euro certainly worth 83p by Christmas.


 
Well you are correct as of today its 84p.

So will we see more of a drop in the sterling against the euro for christmas then?


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## mooney76

looks like sterling is expected to hit parity by christmas although a barclays strategist reckons it will reverse , however he is the only one.

I read today that there is expected to be a new wave of subprime like mortgage default on the way with no doc mortgage default on the rise and unemployment the same

just checked www.currency.ie and it euro gbp is at 91.70, it was weaker last week, strengthened a little but interesting to see where it goes from here


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## theresa1

Maximum it will hit 0.97.


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## BeanPole

How does an Bord Snip have anything to do with the Sterling exchange rate?

Have you seen the thing about the llamas on the M50?


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## mooney76

hey theresa1
how do you arrive at that assumption?


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## mooney76

theresa, how can you substantiate that sterling will not go over .97?


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## Protocol

The euro passed 92p today, touched 92.6p.


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## theresa1

mooney76 said:


> theresa, how can you substantiate that sterling will not go over .97?


 

- I cant but time will tell.


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## Protocol

http://www.ecb.int/stats/exchange/eurofxref/html/eurofxref-graph-gbp.en.html


The euro crossed the 93p level on Monday 12th Oct.

The IEA exporters association were on the radio today - the weak pound is hurting them.


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## gribr

its crossed 94p today

http://newsvote.bbc.co.uk/1/shared/fds/hi/business/market_data/currency/13/11/intraday.stm


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## Boros

my professional option is that we will not reach parity,

today we have broken the 0.8928 ( 1.12) resistance level, it is expected in the short term for the Pound to make gain against the Euro towards the 0.87719 (1.14) level

having said that there is a large amount of data out this week including the dreaded BoE interest rate announcement and more importantly the Quantitative easing announcement, and the Ecb Rate announcement. 



There is huge potential for gbp/eur to swing in either direction depenidng on the results of this announcements. But projections are that we will move away from parity.


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## cmsl

Hi all,
Just wondering is there a more cost effective way of purchasing sterling 'euro to Sterling' than my local bank? From time to time I purchase equipment from the uk and the exchange rate I get from my bank  compared to what is listed on the likes of www.fxcentre.com or www.ex.com is allot lower. 
I would be exchanging various amounts from 20K to 80K, every 2-3 months. I have asked for a discounted rate and they inform me that 
only on amount greater than 60K and its hardly worth getting when you compare the difference.
Is there any advantage in having an account that you could buy sterling when the euro spikes and hold it in reserve until a purchase is taking place.
I have herd of sterling accounts how do these work??
Is there 3rd parties where I can buy sterling at a more competitive
rate than my bank??
Thanks for any help in advance


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## Boros

Hi,

Yes there are comapnys that can offer a better rate of exchange and help manage the exposure to currency fluxuations

One being omnisfx,  if you would like to know how this process works check out

www.currencyexchange-advice.com

On the amounts you have stated you would be looking to save around 300/400 sterling on each transfer comapired to using a standard bank, as the margins taken are considerably smaller

I hope this helps

A


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## mooney76

currency.ie do it, like everything else call your bank and compare and see who can offer the best rates


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## Boros

i agree a comparison rate is always the best way to go.

regarding the current movements of the euro over the past week we are currently seeing abit of euro weakness and are testing the 0.89525 resistance and if we break it we could see 0.87719 in the short term.

in conclusion we have been and are likley to trade between the range of 0.9107 - 0.89525 until more information is released about the EU/UK economies and who is going to decrease their QE and raise interest rates first.


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## howzaboutit

Nobody can predict exchange rates and people rarely succeed. I got predictions from Blue FX Markets, Ulster Bank and Anglo Irish dealers for the new year and although giving convinving arguments, they were all competely different. It is easy to say it will hit parity or 0.85 but don't forget a stopped clock is also correct twice a day. Try Mystic Meg or the dart throwing monkey.


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## Boros

howzaboutit said:


> don't forget a stopped clock is also correct twice a day. Try Mystic Meg or the dart throwing monkey.



lol very true


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## Boros

we have broke the resistance at 0.8843 (1.1308) and if it holds this resistance there is scope and expected to move towards 0.8733 (1.1450)


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## Boros

UPDATE - the current interbank rate is 0.8684, and with the decision about Greece effecting the euro strength while current speculation is that the rate will move towards 0.8474 over the coming months. 

also i write a short daily update on current market movements for the Pound, Euro and USD if that is of interest to anyone get in contact at info@currencyexchange-advice.com


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## csirl

Will approach parity sometime in 2011 - after the Conservatives win the next UK election and are forced to take drastic action to try to save the UK economy. Long term - I'm talking about 5-10 year plus, Euro will eventually settle at a level above parity with sterling.


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## Boros

that's a bold statement csirl 

i don't think we will get past parity but who knows


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## ringledman

csirl said:


> Will approach parity sometime in 2011 - after the Conservatives win the next UK election and are forced to take drastic action to try to save the UK economy. Long term - I'm talking about 5-10 year plus, Euro will eventually settle at a level above parity with sterling.


 
The markets are waiting for the Conservatives to win and bring in fiscal discipline as they always do after Labour bankrupt the UK.

This was clear in the 70's after the IMF had to bail out the UK after another bloated government led socialist and statist catastrophe.

The markets are waiting to know that a hung parliament won't occur before sterling rises against the euro. 

As sterling is already down 25-30% against the euro, likely to have a competant government in place from June onwards and as the Euro is clearly overvalued in light of its inherently flawed southern states; 

*parity between the euro and sterling is very unlikely to occur.* 

More likely a strengthening of sterling against the euro will occur from mid 2010 onwards. 

This is not to say sterling is a good investment, long term it is as flawed as the euro and dollar are.

Nonetheless, comparing one flawed currency against another and one has to rise. Sterling has been a dog V the euro for 2-3 years. 

I now sense the worst of the two going forward will be the euro due to its inherent problems. The ECB have held off printing but will be unable to do so as a deflationary depression takes over the Med with huge social unrest. April will be an interesting month when Greece need to reissue a load of their bonds.

Part of the reason to own gold and Asian assets. All Western currencies are long term flawed. 

Printy, printy is the only way out of our situation, albeit with huge consequences.


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## mooney76

should be useful
Sterling euro charts
www.transfermate.com/en/exchange_rates_table.asp?currency=EUR&curr_lim=GBP


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## Protocol

Stg dropped back during the last two days.

http://www.ecb.int/stats/exchange/eurofxref/html/index.en.html

Wed 24 Feb = 87.75p

Fri 26 Feb = 89.27p


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## ringledman

What is occuring is a "rotating sovereign debt crisis". 

http://www.guardian.co.uk/business/2010/feb/28/sterling-crisis-currency-pound

Comparing the flawed pound, euro and dollar against each other. 

A clash to the bottom between 3 flawed and worthless fiat papers that no longer have any real private industry to support them. Government supported economies lead to worthless currencies over the longer term.

Long term investors are better off positioning themselves in real, 21st century currencies - 

Gold
Asian currencies, stocks and bonds
The Aussie and Canadian dollars
The Norwegian Krone

These are the places where currencies will rise against the bankrupt West over the next 10-20 years.

Peter Schiff sets out in 'Crash Proof 2.0' how an investor should position themselves to make currency gains from the fall of the West and the rise of Asia and commodity producers.


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## RMCF

ringledman said:


> What is occuring is a "rotating sovereign debt crisis".
> 
> http://www.guardian.co.uk/business/2010/feb/28/sterling-crisis-currency-pound
> 
> Comparing the flawed pound, euro and dollar against each other.
> 
> A clash to the bottom between 3 flawed and worthless fiat papers that no longer have any real private industry to support them. Government supported economies lead to worthless currencies over the longer term.
> 
> Long term investors are better off positioning themselves in real, 21st century currencies -
> 
> Gold
> Asian currencies, stocks and bonds
> The Aussie and Canadian dollars
> The Norwegian Krone
> 
> These are the places where currencies will rise against the bankrupt West over the next 10-20 years.
> 
> Peter Schiff sets out in 'Crash Proof 2.0' how an investor should position themselves to make currency gains from the fall of the West and the rise of Asia and commodity producers.



Will 'the West' be the new poor in the next few decades?

Taxed to death, laden with personal debt, huge mortgages?


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## ringledman

RMCF said:


> Will 'the West' be the new poor in the next few decades?
> 
> Taxed to death, laden with personal debt, huge mortgages?


 
We'll our standard of living is going to fall for a long time indeed. 

Economic growth will be negligable for 10 years minimum.

Asia standards of living will, albeit from a very low base, grow exponentially. 

We won't get poorer down to their level, we just wont get richer either. Asia will continue to boom and propel their wealth upwards from the low levels currently.

the only 'Western' countries that will get richer, and be it much richer are Canada, Australia, New Zealand and Norway. 

Their time has come. The commodity boom will last at least another 10-15 years as judged by the length of all commodity booms. This will maintain their overall wealth for a long time.

In the 80s and 90s the countries with a poor future were the resource and commodity producers as commodities were in a secular bear market. We in the non resource countries prospered as goods were cheap due to depressed commodity prices. 

This role reversal has now occured. 

Importing commodity countries like - US, Europe, UK and Japan will suffer going forward due to rising costs.

Exporting commodity countries like - Asia (in general), Africa, Oz, Canada, Norway, New Zealand and South America will gain from selling rising priced commodities to us. 

Its the way of the world. Can't be changed. Just a question of how you position yourself to prosper in the future.


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## ringledman

http://www.youtube.com/watch?v=mnSZkcPicEA

The legend says it all...


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## Boros

Pound has been in serious trouble over the last few days dropping down to the 2010 resistance of 1.0980 (0.9107). All on the possibility of a hung parliament in the upcoming election and UK deficit worries. 

The direction of the Pound against the Euro is up in the air atm, if Greece goes bankrupt the Euro could decline, and if the UK deficit isn't sorted or we have a hung Parliament the pound will decline heavily.

__________

*The Pound* declined against the Euro and the Dollar yesterday on political uncertainty and concerns over Britain’s bloated public deficit. A weekend poll indicated that the ruling Labour Party would remain in favour without a clear majority. The prospect of a hung parliament continues to hurt the pound as Britain’s efficiency to deal with its distended budget deficit is continuing to raise concerns. The market will keep an eye on a 2 billion pound auction of 2039 Conventional gilts later today to gauge investor confidence.


*The Dollar *made gains against the Pound while remaining relativity unchanged against the Euro as woes over Greece’s financial debt weighed down risk appetite. The dollar should be a bit quieter this morning as many investors await the ADP employment data and the Fed’s Beige Book.


*The Euro* made gains against the Pound while remaining relativity unchanged against the Dollar after Greece’s biggest public sector union called for a 24-hour strike on March 16 to protest Athens expected plans to cut its ballooning debts. However, the euro was able to recoup some of those losses after Greek Prime Minister George Papandreou announced a cabinet meeting on Wednesday to “take decisions about the economy.” On the economic data front, the European Union’s statistics office said consumer prices in the Eurozone grew 0.9 % in February, pointing to low inflationary pressures and boosting expectations the European Central Bank will start raising interest rates in 2011.


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## ringledman

Boros said:


> Pound in serious ruble over the last few days dropping down to the 2010 resistance of 1.0980 (0.9107). All on the possibility of a hung parliament in the upcoming election and UK deficit worries.
> 
> The direction of the Pound against the Euro is up in the air atm, if Greece goes bankrupt the Euro could decline, and if the UK deficit isn't sorted or we have a hung Parliament the pound will decline heavily.


 
I read that the problems in Greece and the Euro zone are making sterling fall as most of the UK's trade is in the Euro Zone! What a crazy world we are living in.

It's extremely interesting watching the collapse of the euro, pound and dollar. 

You can't really judge the weakness of one v the other as you are mearly comparing the ratio of 2 failed and flawed independent variables against one another. 

One has to give but is not as a result of any real inherent strength v the other.

Priced in a real currency like gold they are all collapsing.


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## sunrock

This is an interesting time for anyone thinking of changing money from euro to sterling or vice versa.The biggest factor is the U.K. political situation and the quantitative easing issue/public deficit.
I predict that the pound will weaken to 97c to 99c to the pound in the run up to the election. This might be over a month if the polls for the election are inconclusive.
If the election is clearcut the pound will strenghten down to below 90c . If there is a hung parliament the pound will stay high and might spike over parity for a few days but then will firm as some government will inevitably be formed.The long term outlook over the next year will be around 90c.


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## Boros

The Pound is looking weak at this present time is likely to break through the 0.9090 support. 

A key figure in a UK hedge firm stated last week that if the UK did indeed have a hedge fund that the euro would break parity against the Pound and the Pound decline by 20/30% across the board.

My personal view is that this will not happen (hung-parliament) but i think the Pound is in for a Choppy ride

www.currencyexchange-advice.com


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## ccraig

Sterling euro has gone over .91
www.transfermate.com/en/exchange_rates_table.asp?currency=EUR&curr_lim=GBP


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