Smart Weekly Currency Note - 27th March 2009

Smart Currency Exchange - Weekly Currency Rates for Overseas Property Buyers

Weekly Currency Interbank Exchange Rates 27th March 2009

Currency Rate Last Week Rate This Week EURO 1.066 1.075 US$ 1.445 1.429 CAN$ 1.795 1.773 AUS$ 2.102 2.067 NZD 2.586 2.510 AED 5.31 5.247 CHF 1.63 1.635 ZAR(Rand) 13.879 13.722 Charles's Thoughts: Having started the week positively, largely thanks to an encouraging inflation report and an increased risk appetite, sterling’s performance during the middle of the week was rather poor as sterling fell against most major currencies. An under-subscription of UK government bonds for the first time in seven years helped to reverse sterlings fortunes.. Poorer-than-expected retail sales figures then weighed on sterling during Thursday’s trading and further losses were made across the board. However, on Friday’s sterling rose against the euro due to inflation issues within Europe but at the same time made losses against the US$ as quarterly UK GDP data showed a larger than expected contraction in the UK economy. The Bank of England’s (BoE) monetary policy will again be brought into focus in the coming weeks as a marked increase to UK inflation could help the bank to take a less aggressive stance and defer/scrap plans for further quantitive easing. Plans put forward by the US government to effectively buy out the toxic assets from the troubled US financial institutions helped to increase risk appetite in the markets at the start of the week thus causing the US$ to weaken. US Gross Domestic Product (GDP) figures released were marginally better than expected but had little influence on the US$’s value generally. However, as has been the case of late, a loss of risk-appetite on Friday due to speculation regarding massive economic deficits in several European economies help the USD to its highest levels against sterling and the euro in some weeks. Discussion of a proposed new ‘reserve’ currency, maintained by the International Monetary Fund (IMF), as a replacement for the US$ as a safe haven asset, has created a new focus for all investors everywhere. Though favoured mostly by the Chinese at present, could this phenomena be what brings a more realistic and accurate value to the seemingly invincible US$? The logistics are mind-boggling and is extremely unlikely to develop in time for use against the current crisis, but a genuine point of interest none-the-less. The euro, which has suffered as a result of events in European states outside of the euro adopted states, continued to falter thanks to major economic deficits and inflation pressures in member states such as Ireland and Italy. Inflation is currently running beyond acceptable levels according to criteria for membership to the single currency in some states and such pressures will surely force the ECB to take action in their meeting on interest rates next week, a cut of 0.5% the widely expected outcome. The euro is approximately 3% down against the US$ this week and at similar levels against sterling. There were no major developments in high yield and/or commodity backed currencies this week although the Australian and New Zealand dollars gained ground on improvement in risk appetite and commodity prices. 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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