THE KNOWLEDGE MARKET MOVERS
WHAT IS AFFECTING EXCHANGE RATES TODAY?
Interest rates: We’ve heard a lot about interest rates lately. And while they’re important for mortgage rates, they also have a big part to play in the currency market. Interest rates are the rate at
which a bank or other lenders charges for borrowing money or the rate a bank pays its savers to keep money in an account. They are determined, in large part, by central banks. Generally, the higher the interest rate, the more this increases the value of a given country’s currency. Higher interest rates tend
to attract foreign investment, increasing the demand for and value of the home country’s currency. Although, as we’ve seen recently, the pound may be heading closer to an inflexion point between interest rates and inflation. This is where currencies no longer react positively to rising interest rates and instead react negatively to sticky inflation, which is representative of the broader state of the economy.
are often used in conjunction with a market order. They can benefit property buyers who have calculated their price within a range below which the purchase price might become unaffordable or too costly. Forward contract: This is an
agreement between two parties to exchange two currencies at a specific rate for delivery or payment up to two years in the future. They essentially allow you to fix the rate, giving you certainty over the price. A forward contract is popular
among property buyers as it allows them to fix the exchange rate as soon as the purchase is agreed upon, so the price is not affected in the months between the deposit and completion. It can also be used to take advantage of a favourable rate movement that could maximise your initial budget.
Regular payment plans:
Whether it’s pension, income, or recurring payments you need to send abroad, a regular payment plan will allow you to set up a direct debit and even fix the rate on frequent small payments for up to two years. Currency specialist:
Although not exactly a tool in itself, expert guidance from a currency specialist is probably the most powerful asset in your arsenal. The dealers at a reputable foreign exchange company will likely have decades of combined experience in understanding what moves the currency markets, and although no one can ever know by how much, they have the tools and expertise to help you navigate the process with confidence. Despite this, many people
making transfers, which also means committing to paying up to £30 per transaction in fees and a fixed percentage on top of the prevailing rate – which is also subject to the fluctuations we’ve already spoken about. A currency specialist can
help save a lot of time, money and stress at any stage of the process – it’s never too early or too late to get in touch. ■
Mar Bonnin-Palmer is Head of Partnerships at Moneycorp
mar.bonninpalmer@
moneycorp.com
moneycorp.com
Inflation: This is measured by various indexes that indicate the rate at which the average price level of a basket of goods and services in an economy increases over time. It’s oſten expressed as a percentage, and high inflation can show a decrease in the purchasing power of a nation’s currency. Inflation is closely related to interest rates, which can influence exchange rates. A very low inflation
rate does not guarantee a favourable exchange rate for a country, but an extremely high inflation rate is likely to impact the country’s exchange rates with other nations negatively.
still rely on their bank when it MORE ONLINE
READ MORE ARTICLES ABOUT FINANCE AT
FRENCHENTREE.COM
FRENCH PROPERTY NEWS: September/October 202389
© SHUTTERSTOCK
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50 |
Page 51 |
Page 52 |
Page 53 |
Page 54 |
Page 55 |
Page 56 |
Page 57 |
Page 58 |
Page 59 |
Page 60 |
Page 61 |
Page 62 |
Page 63 |
Page 64 |
Page 65 |
Page 66 |
Page 67 |
Page 68 |
Page 69 |
Page 70 |
Page 71 |
Page 72 |
Page 73 |
Page 74 |
Page 75 |
Page 76 |
Page 77 |
Page 78 |
Page 79 |
Page 80 |
Page 81 |
Page 82 |
Page 83 |
Page 84 |
Page 85 |
Page 86 |
Page 87 |
Page 88 |
Page 89 |
Page 90 |
Page 91 |
Page 92 |
Page 93 |
Page 94 |
Page 95 |
Page 96 |
Page 97 |
Page 98 |
Page 99 |
Page 100 |
Page 101 |
Page 102 |
Page 103 |
Page 104 |
Page 105 |
Page 106 |
Page 107 |
Page 108 |
Page 109 |
Page 110 |
Page 111 |
Page 112 |
Page 113 |
Page 114 |
Page 115 |
Page 116 |
Page 117 |
Page 118 |
Page 119 |
Page 120 |
Page 121 |
Page 122 |
Page 123 |
Page 124 |
Page 125 |
Page 126 |
Page 127 |
Page 128 |
Page 129 |
Page 130 |
Page 131 |
Page 132 |
Page 133 |
Page 134 |
Page 135 |
Page 136 |
Page 137 |
Page 138 |
Page 139 |
Page 140 |
Page 141 |
Page 142 |
Page 143 |
Page 144 |
Page 145 |
Page 146 |
Page 147 |
Page 148
