Posted on 10 April 2009
Several positive economic factors to emerge in the past 1-2 weeks have seen Sterling begin to rise against the Euro. Cited as reasons for the rise in the Moneycorp article were:
- British Purchasing Managers’ Indices (PMIs) lead the way in manufacturing and services sectors.
- Non-controversial G20 communiqué welcomed by markets.
- ECB rate cut to 1.25% leaves room for more next month.
Sterling has indeed risen against the Euro throughout this week. Moneycorp alerted us to the fact that it rose from 1.07EUR last Monday to 1.10EUR this Monday. A quick check on Moneycorp tells us that the Pound is currently worth 1.11 Euros, which means it has continued to climb throughout this week.
Surprisingly Moneycorp told me that Sterling had actually lost ground to the Turkish Lira, having fallen from 2.38 to 2.30.
I asked them what their forecast would be for the short and long-term.
“There is expected to be no change in the value of Sterling against the Lira over the bank holiday because no one is trading,” said a Moneycorp analyst.
Into next week and in the short term, though there is downward pressure on the value of Sterling against the Lira, its current rate of 2.30 is the support level, and the market’s resistance to trade below this rate should keep it from dropping any further, according to Moneycorp.
“In the long term we expect the Pound will get stronger, certainly climbing back up to 2.35% and possibly even to 2.40%,” the analyst concluded.
“Such a rise in Sterling’s value against the Turkish Lira is likely to make Turkey property even more attractive to British property buyers,” said Julian Walker, director of Spot Blue, specialists in Turkish property.