As you can see from the graph below the pound lost around half a cent against the U.S dollar within a couple of minutes. With no major data releases coming from the UK or U.S or any political announcements, it would seem the decline was sparked by investors profit taking ahead of the weekend.
However, despite the drop the GBP/USD cross is still on course to finish the week around a cent higher from Monday's open.
Apart from this afternoon's dip there has been very little to report, so not wanting to sound like a broken record by talking about Brexit, Trump and the political uncertainty around Europe, I thought I would take the opportunity to explain the different ways you can purchase your currency.
Ways to buy currency
The Spot Contract is the quickest, easiest and most popular way to buy currency. You simply buy or sell one currency in exchange for another, whenever you need it. You have two days to send us the money and as soon as your funds are cleared, we will forward the currency to the account of your choice.
The Forward Contract can help you take advantage of current exchange rates. You can fix the price now for a transaction that will take place up to two years in the future. You secure the Forward Contract with a deposit of 10% of the total value of your transaction (you'll need to pay this within two working days of agreeing the contract) and then pay the balance before the contract expires. Once secured the agreed exchange rate will apply for the duration of the contract.
With a Limit Order you specify the exchange rate you are hoping to achieve, a price that may not be currently available. Your currency will automatically be purchased if the market exceeds this level and you'll get the rate you wanted. This type of contract is particularly useful when the markets are moving in a positive direction for you.
A Stop Loss Order will instruct your broker to buy if the currency goes down to a pre-determined level. When combined with a Limit Order you can hold out for a better exchange rate and still protect yourself from a sudden fall in the market.
Do you need to buy or sell dollars?
If you have a requirement to buy or sell dollars in the weeks or months and want to make sure are making the most from your transfer, contact me today for a free, no-obligation currency consultation.
For more information about how I can help or to find out what rate of exchange I can offer complete the contact form by clicking on the link below.