Sterling rises against the dollar, but what about the long term future of pound/dollar rates?

It has been a quiet start to the week due to Memorial Day in the states and the bank holiday across Europe, a lack of data releases meant markets remained relatively flat compared to recent weeks. We did see sterling gain slightly against the greenback and nudge back over the $1.57 mark largely thanks to some positive vibes coming from Greece.

Polls in Greece showed that the pro-bailout party is currently leading the way in recent opinion polls, easing concerns that Greece will leave the single currency. This increased appetite for riskier currencies, investors left the U.S dollar and headed back to UK and Euro, pound dollar rates to a high of $1.5715.

However, banks revised their forecast for cable as concerns continue to grow over the troubled Euro-zone, JP Morgan now predict that rates will slip back to $1.54 by the middle of the year. This is positive news for clients looking to sell U.S dollars and bringing their money back to the UK, but if you are looking at buying dollars, booking a rate of exchange using a forward contract will protect you from these adverse movements.

So if you are looking at buying or selling dollars in the next couple of months contact me for a free consultation to ensure you are making the most from your currency transaction. As I have said before rates have fallen by over 4% in recent weeks and in my view will continue to fall while the Euro-zone struggles. click here to send me direct email or complete the contact form on the homepage of the blog.