Pound Sterling weakness - what is behind it and how long will it last?

The Pound suffered huge losses in yesterday's trading as a number of different factors - these are the following:

A Hung Parliament - Weak Pound

It appears more and more likely that the U.K will end up with a hung parliament following elections in May according to recent polls and with political uncertainty being one of the four main factors that affect the value of a currency - along with Economic stability, acts of terror and acts of god the Pound has weakened dramatically off the back of this.

Markets move on rumour as well as fact and the longer the hung parliment term hangs over the head of the U.K the Pound will find it really hard to shift back up in the right direction.

PIGS seem to have gone to sleep

The so called PIGS of Europe have gone to sleep of late and the Euro Zone seem to have a talent of sweeping problems under the carpet as opposed to the U.K who are quite happy to constantly talk about them.... Enter Mervyn King and Alistair Darling!!

Once these problems in the Euro Zone come back to light we may see Euro weakness again however whether or not Sterling gains because of this will be dependant on what other problems in the U.K have come to light.

Sterling Dollar hits low since May 09

The Pound dropped to fresh lows since 2009 against the USD yesterday and analysts predict there may be further to go.

We all know what happened last year when the Dollar had a good run so beware if you have an upcoming purchase to make.

GBP AUD 25 year lows

Following the 4th interest rate hike in 6 months the Australian economy appears to be handling the global crisis extremely well, how much lower can this go with important GDP figures due out this week for Australia.

GBP CAD also at fresh lows

The Pound also hit fresh lows against the CAD following much better than expected GDP data released over there yesterday, yet another currency pairing that is breaking long term records!

This is a brief summary of todays report for further information on the currency markets or if you have an upcoming transfer to make and want to discuss the options available to you call Daniel Wright on 01494 787462 or email me djw@currencies.co.uk

I assist thousands of clients to send money overseas or receive money from overseas involving the following currencies - Please note I do not deal with cash it is bank to bank only!! AED AUD BHD CAD CHF CZK DKK EUR GBP HKD HUF INR ILS JPY KES KWD MAD MUR MXN NOK NZD OMR PLN SAR SEK SGD THB TRY USD ZAR



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