Bad news for all the French, Italian and Spanish workers in London (who earn in pound and spend in euro): the pound has fallen to a new record low against the euro today. And also for English people this means problems and a growing fear about the strength of the British coin.
“The euro climbed to 87.79p against the pound on the currency markets, building on a previous high of 87.73p,” reports the Timesonline.co.uk. “At the same time, sterling hit $1.4765 against the dollar”.
The British pound has been weakening during the economic downturn: in the past 12 months the sterling has fallen 17.4% against the euro and 27.1% against the dollar. The pound is now almost euro parity… is it time to change and accept the euro?
Now £100 are changed for €114.13; amazing news for tourists in Europe!
Welcome back to London Presence. In our daily press review, we want to talk again about the turbulant time for the Economy around the World. Bloomberg, our favourite reference, has underlined again today that the European confidence has dropped most since September 11 Attacks. In his analysis, the editor Fergal O’Brien explains how “Europeans’ confidence in the outlook for the economy dropped the most since the September 11 terrorist attacks…”.
Last week the German Finance Ministry spoke about the long way to a recovery in Europe’s biggest economy, the euro rose to $1.5916, whilst the dollar and the pound slumped against the euro. Then, after the announcement by the Treasury Secretary Henry Paulson concerning the possibility of raising interest rates, the dollar has started to rise against the yen once more. In the meantime the pound has stabilised against the dollar, but analysts have warned the pound is to weaken by the fear of a UK recession.
It’s a volatile period in which markets are stormy and exchanges are swinging in every direction. The bull and bear of the market seem to have replaced the inconsistency in London weather as we seem to have found a sunny patch for a change.
A lot of experts suggest just one solution: spreadbets. “Spreadbetting is a way in which risks can be reduced and overall returns enhanced”, say senior sales traders. But what is a spreadbet?
Keep in touch and we will soon explain what it means and how it works.