Currency Rates

EURO/GBP - 1.141
US$/GBP - 1.616
CHF/GBP - 1.682
CAN$/GBP - 1.708
AUS$/GBP - 1.784

Comments: Despite global stock markets suffering towards the end of last week over concerns that Barack Obama’s hard line stance on bank regulation would stifle the recovery, sterling held up relatively well. Traditionally over the last few months, sterling would have weakened as investors bought into the ‘safe’ US dollar. This is encouraging, however the market might be waiting to see the outcome of this week’s biggest UK news – the GDP growth figures for the 4th Quarter of 2009. This is expected to rise marginally for the first time in seven quarters, and despite a rise already being expected, it is likely to pose the biggest risk for sterling this week. In addition, on Wednesday, the first retail sales data for January is released. With December’s unexpected rise in retail sales attributed to consumers bringing ‘big ticket’ purchases forward ahead of the VAT increase, this week’s figures are expected to show a decline as a result.

German consumer sentiment fell for the second consecutive month this morning as expiring government funding supporting the labour market sees many expecting the German economy to shed 15,000 jobs this month when the data is released on Thursday – the most since March. Aside from this, there is Euro zone unemployment and inflation data released on Friday.

In early trading in Asia, the US dollar dropped off slightly against major currencies as investor risk aversion calmed over the weekend. This was helped by assurances that Fed Chairman Ben Bernanke will be confirmed for a second term in office – easing concerns over the leadership of the central bank that surfaced last week. On Friday, the US GDP growth figures are released. The consensus is for a 4.6% rise, with some analysts expecting a jump of over 5%. Housing data out today is expected to be mixed – with existing home sales expected to drop and new home sales expected to rise.

Elsewhere, Australia’s wholesale price inflation data came in worse than expected. This may see amended expectations of interest rate hikes at the next meeting of the Australian central bank in February.

The general theme suggests that if you have payments to make in other currencies, there is a high chance of volatility this week – with US and UK GDP figures out. Sterling may outperform, but at the same time it may suffer – especially if US data outperforms expectations. Therefore, remember to minimise the chance of losing money due to adverse movements in the markets by speaking to a currency specialist as early as possible.

Note: All rates are mid market inter bank and indicative at the point of publication.

To get an initial estimate of the cost of a property simply DIVIDE the price of the property by the appropriate currency rate noted above.