Smart Weekly Currency Note - 26th October 2008

Smart Currency Exchange - Weekly Currency Rates for Overseas Property Buyers

Weekly Currency Interbank Exchange Rates 26th October 2008

Currency Rate Last Week Rate This Week EURO 1.288 1.260 US$ 1.729 1.592 CAN$ 2.040 2.035 AUS$ 2.504 2.563 NZD 2.823 2.863 AED 6.351 5.851 CHF 1.964 1.859 ZAR(Rand) 17.351 17.960 Charles's Thoughts:  Conditions went from bad to worse for sterling this week. On the release of poor GDP figures on Friday, which were widely expected to show the UK economy contracting over the last quarter, the pound went to a new record low against the euros and slipped further down against the US$. Considering that the poor GDP figures and the comments earlier in the week from Mervin King and Gordon Brown which did the damage to sterling did not tell us anything we didn't already know it was perhaps further testament to how volatile market conditions continue to be. The Bank of England's minutes from their meeting this month were released and showed the members to be unanimous in their decision to cut rates a fortnight ago. The growing likelihood and speculation is that UK interest rates will be down to as little as 3% by the middle of 2009. The US$ has, by all accounts, broken free from the recent effects of the credit crisis and continued to surge across the board and throughout the week. Having gained back roughly 25% of its value against the pound over the last eleven months and sitting at its highest level against the euro since October 2006, the speed of the recovery has taken many by surprise. The fact that the Federal reserve have only 150 basis points left to cut from their interest rates will certainly have helped the US$ of late and expectations are that the Fed will cut again by a further half a percent next week to 1% in their next monthly meeting. In spite of the positive movement against sterling, the euro had a relatively poor week and has, like sterling, fallen lately on the increasing speculation that interest rates will be cut in the coming months, some speculating that they will be as low as 2% by the middle of 2009. Euro Purchasing Managers index figures which showed the recent and somewhat rapid decline of the European economy was also a main contributor to the sharp fall of the euro in the markets. Of the high yield and/or commodity backed currencies, it was the South African Rand that saw the biggest movement as it fell to a price against sterling more than 30% down from the start of this year. The New Zealand Dollar was also affected by having seen a further cut to their interest rates this week as the economy moves towards a deep recession ahead. Why is Currency Management So Important? Using a bank could cost you £3-4,000 per £100,000 transferred. Buying at the "wrong" time could cost you many £'000's more as rates can move as much as 3% in a very short period of time. Then add in transfer costs that the banks charge for sending and receiving funds and you could be looking at additional costs of £10,000 per £100,000 transferred. By developing a currency strategy and by working with a specialist currency broker these losses could be minimised if not eliminated. Smart Client Testimonial: "Thank you for making our transactions go so smoothly. As promised, our account was opened within hours. Your traders were pleasant and efficient, and each transaction was very much at the exchange rate I expected...ie not a million miles away from the inter-bank rates and certainly much better than my high street bank could quote. All in all, an easy experience and we will have absolutely no hesitation in recommending your services to any of our friends buying property abroad." Ian Pritchard If you haven't opened a Smart account yet, call me on freephone 0808 163 0102 or fill out our online Account Form at: http://www.SmartCurrencyExchange.com/application.htm How much will a Property Cost? To estimate the cost of a property simply DIVIDE the price of the property by the appropriate rate noted above. But note this is based on the inter bank rate so the actual cost will be slightly more. Charles Purdy Smart Resources Currency Strategy Worksheet Need help creating a Currency Strategy? Download our Currency Strategy Worksheet: http://www.smartcurrencyexchange.com/downloads/CurrencyStrategyWorksheet.pdf Currency Report Have your read our 10-page Currency Report that outlines the top 3 mistakes that overseas buyers make when exchanging and transferring their money overseas? Get the report here: http://www.SmartCurrencyExchange.com/downloads/ThreeMistakes.pdf Currency Quotation Are you interested in a currency rate for Euros, US$'s, CYP, NZD, or any other currency, please fill out our Smart quotation form at: http://www.SmartCurrencyExchange.com/smartquotation.htm Smart Currency Exchange Limited

email: Charles@SmartCurrencyExchange.com free phone: 0808 163 0102 web: http://www.SmartCurrencyExchange.com

Smart Currency Exchange | 1 Hammersmith Grove | Hammersmith | London | W6 0NB | UK © 2005-2008 Copyright  Smart Currency Exchange Ltd THIS PUBLICATION DOES NOT CONSTITUTE ADVICE WITHIN THE TERMS OF THE FINANCIAL SERVICES ACT (OR ANY SUBSEQUENT REVISIONS, ADDITIONS, OR AMENDMENTS). Disclaimer Exchange rates can move very quickly. The above rates are the interbank rates and valid at a moment in time. The interbank rate is the rate at which the banks deal with each other in the foreign exchange markets. Suggestions should not be taken as advice or fact. The market does what it wants to do.  We have no crystal ball and as ever we suggest that if an exchange rate works for your budget then don't try and wait for an even better exchange rate, as Murphy's Law says the rate will go against you and cause you maximum trouble!

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