The pound rallies against the Euro

[Lamby]

According to a certain newspaper the so called "money experts" are telling us to buy our holiday money today!! Some foriegn exchange outlets are offering 1.23 Euro to the £.
They say this may be a yearly peak for 2010. Whilst I am no expert I will be topping up my Travelex card with £500.00 (610 ish Euros) this evening. Based on what I got earlier this year that represents over 100.00 Euros more for the same amount. All the better for hitting the bars and restuarants in CVO in 2011. Just a thought

[EMM]

THe £ is easing back but is still much stromger than earlier this year. We may have seen the peak so it is good time to buy euros.

[The_Quiet_Man]

I think we'll see 1.25 - 1.30 by October personally.

[EMM]

Like an English summer the sterling rally was short lived. The £ is heading back to E1.17 with little evidence that it will bounce back to E1.20 plus in the short term.
At least I got a decent rate for our last visit.

[cereza]

Back to 1-20 today
Now waiting for the results of the European Bank Stress Tests

[maccasa]

yes - clealry as a result of the last qtr results of 1.1% growth - and also clealry stimulated by the labour parties actions earlier in the year.

[cereza]

Er - NO

[EMM]

THE £ went up because of the growth figures ( fell back a bit as Euro rise after Bank stress test results ) . Nothing to do with any actions taken by government in the last 6 months. The rise in economic activity is global.

[The_Quiet_Man]

The UK banks - especially Barclays - will do well from the stress tests. Lloyds will fair worst of all.

I think the £ should get a boost from this news this week.

Edit - meant to add that someone I know says they were getting 1.21 from the ATMs in the Algarve last week

[HampshireRich]

Its all irrelevant - stress tests, economic figures etc - the value of sterling against euro against dollar is all down to speculators and people making "a quick buck".

I have followed sterlings fortunes against the euro for many many months and to be quite honest, if you followed the "rules" about financial well-beings of countries, forecasts etc, the value of sterling, the euro and the dollar just don't make sense. The only impact is gambling on a huge scale (or fixing -whatever you prefer!).

A fixed rate for 12 months at a time would be a lot more sensible - give us all chance!

[cereza]

[quote="HampshireRich"]Its all irrelevant - stress tests, economic figures etc - the value of sterling against euro against dollar is all down to speculators and people making "a quick buck".{quote}

Disagree Rich - it's all down to bad judgements and errors by governments - the speculators just take advantage.

[HampshireRich]

Disagree Rich - it's all down to bad judgements and errors by governments - the speculators just take advantage.

... and that's the point really cereza - they do take advange and is does impact the rates - just the same as share prices - if the speculators get a whiff of something, the company's share price is attacked resulting in instability (suggested take-over, reduced credit rating etc) and sometimes even the demise of the company.

[cereza]

Well I think individual company shares are a different matter - a spec selling raid can destabilise a company as you say and thats why governments have been trying to ban short selling. Major currencies on the other hand are way too big to be manipulated unless there are fundamental faults as when Soros forced Sterling out of the ERM and now with the Euro. The faults will be found out in the end but it's the specs who bring them to a head.

Don't forget that specs don't always get it right if the fundamentals are against them - look at the short selling of VW last year!!

[HampshireRich]

Major currencies on the other hand are way too big to be manipulated unless there are fundamental faults as when Soros forced Sterling out of the ERM and now with the Euro.

George Soros brought the UK to its knees in the mid-90s - they estimated that he pocketed $2 billion - interest rates rising 3% in 1 day - all to keep the UK aligned against the euro. It was opportunisitic for Soros - but even so, one man nearly destroyed a country and a system that allows that is flawed.

If we had set interest rates and set exchange rates for a fixed period of time, this would surely be better in the long term?

[cereza]

I'm not disagreeing with your figures Rich but there is an unknown figure for the amount that Soros saved this country by forcing us out of the ERM and thus the Euro. The system was created by politicians and was flawed - it could not last as it was and even now the Euro with all of the tweaking over the years is still fundamentally flawed. Thank God we never joined it because we could now be in the same position as Greece. If the system had been a good one then Soros alone could not have forced us out - he just took advantage of a bad system to make a lot of money but actually he did us a great favour in the long run.

A fixed rate like the ERM can never work in the current world economy because there are far too many anomalies in the various countries - if such a rate was attempted it would be a gift to the specs just as having sterling in the ERM was to Soros