When should I sell my Euros?

2015 has been a very rocky year for anyone selling Euros to buy sterling, dollars or any other currency. I have had many clients very upset at the direction Euro exchange rates have taken and it would appear that trend is not over yet. This post shall examine the fundamental reason why if you are selling Euros moving sooner and selling on the dips really is the best strategy moving forward.

ECONOMIC CYCLE

Most currencies follow the economic cycle of the economy they respresent. In the case of the Euro and the Eurozone we have recently had some growth but news last week indicates the ECB (European Central Bank) might look at more QE in the future. Quantitative Easing is essentially a currency weakener. By printing money a central bank undermines confidence in the currency and increases the money supply. Remember when GBPEUR was almost 1 for 1? Well that was when the UK embarked on a dramatic round of QE and the currency weakened by many cents. This analysis helps explain why the Euro has weakened so much in 2015.

The UK and US have done their QE, the Eurozone is only just realising it needs to do this to kickstart the economy. News last week that the ECB will consider more if they have to has done little to improve confidence in the single currency. Throw in Greece and you can start to see why investors have done such an about turn on the Euro. The UK and US are gently leaning to tightening monetary policy, the Eurozone is still in the mire working out exactly bad it is going to be.

This week there is some very important economic news for the Eurozone plus the US and UK too. Exchange rates change every second and we can assist with forecasts and information to help you get the most from the market plus ensure you get a bank and other broker exchange rate beating deal. Please email me [email protected] for more information.