Good afternoon readers!
Once again this afternoon has seen Sterling slide away against many major currencies due to Mervyn King speaking earlier this morning, and not ruling out further rate cuts in the U.K in the near future.
This swiftly prompted investors to move their funds away from sterling following a couple of days of positive news for those of you with upcoming requirements. As many regular readers are aware a interest rate cut generally has a negative impact on the currency concerned as investors tend to move their funds over to higher yielding currencies in order to get a better return on their funds.
"Following the release of weak retail sales data the pound dropped to session lows against the euro and dollar.The Confederation of British Industry's distributive trades survey showed a retail sales balance reading of -26 in April, much weaker than forecasts for -3 and the lowest reading since November 2005. The balance was +1 in March.Couple this with poor housing data yesterday and the markets will be looking for sharper action by the BOE, possibly further indication of a rate cut for May, earlier than the expected June cut". Said Simon Eastman, Senior Executive Dealer at Foreign Currency Direct.
Please do keep in touch if you do have upcoming requirements as the market is extremely volatile at present, and just a movement of 1% against you on a £200,000 will cost you £2000.
If you have any questions regarding this report, or wish to discuss an upcoming requirement with an experienced broker that will talk on your level, please email me at djw@currencies.co.uk providing a telephone number and i will get in touch straight away.
Have a great day and thanks for reading!
Daniel Wright
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