GREECE TO STAY IN EUROPE? AUSTRALIA & NEW ZEALAND RATE CUTS

We saw the GBPEUR exchange fall from 1.34 down to 1.32 as this week ended; The initial push on the exchange rates was the results of the Greek election; However following this, the ECB confirmed that Greece WILL be remaining in the Eurozone, which means that debt plans will now be re-arranged. Short term this is great news for the Eurozone, which is why we have seen the Euro begin to strengthen and the exchange rates have begun to re-trace. The only thing I would be aware of is Greece will still be negotiating plans with Europe, so you can expect volatility over the next few weeks.

Another thing that is worth noting is that the BoE’s latest rate decision showed a 9-0 vote against an interest rate hike, which means that the UK will not be looking at pushing up interest rates until early 2016 at the earliest, this is no surprise as historically we have not seen interest rate hikes around UK election time, so please keep this in mind if you are selling GBP, the only reason we have been strong against the Euro is due to Euro weakness, not Pound strength.

Speaking of interest rates, it is expected that Australia will cut theirs this month, and following this so will New Zealand, we have already seen the GBPAUD price go from 1.88-1.94 over the last 5 days and the GBPNZD from 2.04-2.08, so if you are looking to purchase the AUD or NZD then Wednesday is a date worth noting (Australia rate decision).