Smart Weekly Currency Note - 3rd July 2009

Smart Currency Exchange - Weekly Currency Rates for Overseas Property Buyers

Weekly Currency Interbank Exchange Rates 3rd July 2009

Currency Rate Last Week Rate This Week EURO 1.175 1.167 US$ 1.652 1.633 CAN$ 1.904 1.896 AUS$ 2.045 2.048 NZD 2.558 2.590 AED 6.063 6.001 CHF 1.788 1.774 ZAR(Rand) 13.037 12.911 Charles's Thoughts: In all a frustrating week for sterling investors as Monday started positively with the pound making marginal gains on most major currencies thanks to surprisingly positive figures regarding UK house prices. However, following Tuesday’s much worse-than-expected UK GDP data which showed the largest contraction in the UK economy for over 50 years, the pound started a downward trend which lasted through the week against the US$. Risk aversion played some part in the large losses for sterling as the positive sentiment that had been growing over the last ten or so weeks fell away and reminded us all that we are far from seeing the end of the recession or the economic problems associated with it. Next week we will hear again from the Bank of England after their meeting on interest rates. Once again the expectation is for no change on interest rates but as with recent months it will be the comments from the members of the Monetary Policy Committee and the market reaction to their very cautious tone that may put sterling on the back foot once again. With little US market data due out in the week, the US$ was subject more to the whim of risk appetite/aversion than any other driving forces. It was also a shortened week in the US with Independence Day falling on Saturday and Friday taken as the bank holiday in lieu. Sharp gains were made against sterling midweek following the poor UK GDP data and the resulting risk-aversion helped the US$ to gains against most other major currencies throughout the week. The important ‘Non-Farm Payroll’ data, which is a much anticipated indicator for US unemployment, was rather disappointing but as already seen in the last few months, this only served to strengthen the US$ thanks to the growing demand for safe haven assets. The main focus for the Eurozone this week was the European Central Bank’s (ECB) decision on interest rates with the outcome a much expected hold at current levels. The accompanying statements were also familiar to recent months’ meetings with little sign that policy will take any sudden change of direction. The ECB’s outlook for Europe seems to be consistent with recent views that contraction in the Euro-economy will continue throughout 2009 and potentially well into the second half of 2010 seemingly opting for a slow and steady reaction to the rate of decline in productivity. Euro-zone GDP data out next week will almost certainly put the euro under pressure should the result be as disappointing as that of the UK this week. There was no major news from the high-yield and/or commodity backed currencies this week. 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 Lyric Square | Hammersmith | London | W6 0NB | UK © 2005-2009 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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