Euro Strength once again as Weidmann comments on QE not beiung needed (Daniel Wright)

We saw an unexpected and rapid period of Euro strength yesterday afternoon, which also followed through until trading early this morning which was mainly down to unexpected comments from Dr Jens Weidmann from the European Central Bank that he felt QE (Quantitative Easing) would not be needed at present.

Many analysts and speculators had started to expect further QE to be announced at the next ECB monetary policy meeting,  so this comment started to bring in a few doubts.

QE is basically printing more money and getting it into the economy to give it a boost and can actually be seen to weaken a currency due to it meaning there is more of this currency available. It can lead to high inflation should too much of it be bought in and has been used by a number of central banks in an attempt to kick start economies over the past few years.

Should the ECB decide they do not need to alter their QE program in the coming months then I would expect to see further Euro strength however for me that would be a surprise. I still feel the Euro is now a little over valued and that the current period of strength will reverse in the coming weeks.

If you have Euros to sell, now may be a prudent time to look at locking in a rate of exchange and if you are looking to buy Euros then I would personally be cautious but tempted to hold on a little.

If you are in the position whereby you need to buy or sell Euros then it is vital to have a proactive and efficient currency broker on your side. We welcome all new clients and even if you feel you are currently getting fairly good rates from your current broker or bank then I would be surprised if I could not better them for you.

Feel free to get in touch with me (Daniel Wright) on [email protected] and i will be more than happy to get in touch with you personally to discuss your exchange.