Good afternoon,
It has been another torrid few days for the pound leaving the GBP/USD cross at its lowest levels since February this year. Since my post on Monday Sterling has fallen by almost two cents against the dollar leaving the currency pair hovering around $1.6450 as the graph below shows.
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So what has caused the drop?
Despite the UK posting positive construction and services PMI numbers over the last two days the pound has weakened against most of the other majors, as investors agonised over a potential ''Yes'' vote in the upcoming Scottish referendum.
A poll released earlier in the week showed the pro-independence camp were now only 3 percentage points shy of a ''Yes'' vote in the poll due to take place on the 18th September.
If Scotland were to vote ''Yes'' and become independent the effect on the UK economy could be huge. The potential breakaway is already having a negative impact on investor confidence and if the "Yes" vote is confirmed in a couple of weeks' time the pound could be set for some heavy losses.
Can I protect myself against a falling pound?
If you have a requirement to buy dollars in the next couple of months getting the timing right on your transfer will be crucial. As a specialist currency broker I have a range of tools at my disposal to limit your exposure to the every changing FX market.
A popular option at the moment is a Forward Contract, it allows you to secure your rate at today's level and hold it for up to two years into the future, protecting yourself from adverse market movements.
For more information on the different types of currency contract or to find out what rates of exchange I can offer, use the link below to complete the contact form all call me directly on 0044 (0) 1442 892065.
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