alfista1

For years overseas the GBP has been weak while I was making USD.

Now we're trying to put together the 62500 GBP (but in USD) for the spouse visa and the GBP decides to rocket!
Every 100 USD we save the GBP creeps up

Typical!

Any market experts out there know when it will be a good time to buy GBP? Will it begin to fall again over the next 6 months or so? Million dollar question I know.

Was hoping to transfer money in a month or two into Barclays.

lgabriel73

The USD has gained a little strength over the past few weeks based on the exchanges I have done but I don't think there is going to be a dramatic change anytime soon.

bandrui

I too have been keeping an eye on the pound. Here's a chart with history that can help with that.

http://www.xe.com/currencycharts/?from=GBP&to=USD

Where it goes from here will depend a lot on what happens politically and economically in both countries. Impossible to predict.

If and when it does go down, can you buy GBP at that time or do you have to have the spouse visa amount in USD?

alfista1

I am hoping it will drop a bit soon. Heard interest rates will go up in the uk though but maybe the u.s has an influence also. Not good for their trading at the moment.
That chart is scary. It has sky rocketed! 1.62 would be a better rate. Fingers crossed it doesn't climb any higher. 1.67 today! !

I can have the spouse visa in any currency but they convert it to gbp on the day of the application so I would feel more comfortable it being in gbp so I know the exact amount for their requirements.

In other words yes I would like to buy when it drops to a better level but we can't wait too long.

chris955

Echange rates will never suit everyone unfortunately. If we were to move back to the UK today we would have literally 10 of 1000's less £'s compared to when we did move coming up to 2 years ago.
I dont think interest rates here will be increasing just yet so I wouldnt be relying on that.

dunroving

Following exchange rates is a source of madness.

The $/£ rate has been climbing since last summer, when it was below $1.50. Just about every expert article I have read on the subject over that period lists the economic arguments for the dollar to strengthen against the pound, yet it goes inexorably in the opposite direction.

People on BE can give you their opinion just like the "experts" but as an armchair expert who has been reading articles on the $/£ for years, all I can say is that the profesionals seem to get it wrong more than they get it right which, considering they have a 50-50 chance of being right, is pretty scary.

As Chris said, BOE interest rates are highly unlikely to go anywhere for about a year (this from the horse's mouth via Mark Carney).

Edited to add: The best philosophy is to either drip-feed your currency exchanges, to even out your gains/losses, or choose what rate you would be happy with, set it up with a company like xe.com and when it exchanges, stop looking at the rate after that, or rather, don't torture yourself if it gets even better. That's like marrying someone and constantly looking at other women to see if you could have got a better one.

Editha

My own experience suggests it is worth taking notice of forecasts.

Our original plan was to put our house in Canada on the market a few months before going back to the UK in July '14. But this time last year, I got the jitters because of forecasts of the pound strengthening against the CAD, a house-price boom in the UK, and some negative forecasts for the Albertan economy.

So, we put our house on the market in the spring, closed on the sale in July, and completed a house purchase in Devon in August.

The forecast for the Albertan economy was wrong, but there have been house price rises in the UK, although they have been modest in the West Country where we are moving.

On the exchange rate, however, the forecast, that it might get to 1.75 by the end of the year was dead on. At the beginning of the year the exchange rate was 1.5.. something, by the time we sold it was 1.64, it had reached 1.75 by the end of the year and it is currently 1.839.

Maybe we've just been lucky, but I think it is worth reading the financial pages and keeping an eye on the forecasts.

scot47

Ah for the days when US$4.80 was £1

Careful analysis indicates that we are no longer "Top Nation" !

dunroving

So of the three forecasts you have described, one was incorrect, one was correct, and one was "neither" (UK house price changes have been negligible in most parts of the country, going either down slightly, up slightly, or remaining static) ...?

It sounds like overall, following your gut instinct turned out well, but I'm not sure it provides any support for making major decisions based on forecasts. I keep my eye on them regularly and they more often turn out to be wrong. Just look at Mark Carney's forecast that it would take the best part of a couple of years for unemployment to hit 7%. Only about 18 months off! And most "expert" active fund managers can't even beat the major stock indices - but it doesn't stop them charging exorbitant fund management charges.

chris955

Not sure Scotland was ever Top Nation

Editha

Actually, two were correct. The house price forecast was for a 4% rise in 2013, which was spot on for the West Country, but an underestimate for the country as a whole. And not negligible either.

For me, it confirms what I've observed over the last 8 years I've been in Canada, that the quality of the financial press in Canada is poor compared to the UK. They've forecast a collapse in house prices virtually every year for the last 5 or 6, basically, as far as I can see, because it makes a good New Year headline.

dunroving

I was going by what you said in your post, that the forecast was for "a house price boom in the UK" - that's not the same as a 4% rise in the West Country and drops elsewhere.

I'm glad that your decision worked out for the best.

Editha

Fair enough. I wasn't clear, and I'm not even sure which prediction I'm thinking of. Looking back on the predictions at the beginning of '13, most of them were for prices to stagnate during the year. It wasn't until mid-year that it changed.

bandrui

House prices in the UK are up considerably in most areas. I keep an eye on Zoopla sales in quite a few different areas and there is no doubt about this... sometimes as much as 10-12%, whereas house prices in Canada were down but now slowly recovering (over the past 12-18 months).

Editha made some smart informed choices.

bigglesworth

I would absolutely echo Dunroving. I ran a large dollar exchange book in my trading days, and have followed currencies relentlessly for the best part of forty years. One simple question.
If you actually reliable KNEW where a price would settle, why would you tell anyone else?
On the other hand, if you had a large position long or short of the dollar, and you wanted to trigger a move, surely you would tell everyone that the pound was just toilet paper or was set to soar.
Occasionally someone strikes it lucky, and they believe that gives them some special insight. Trust me on this - NOBODY knows. Except perhaps George Soros, and that was a slam dunk when everybody and his brother was shorting sterling- including the Bundesbank.
The BoE would dearly love sterling to head lower, and will do all it can to achieve that. But what is going on in the markets at present is something different. It is very much a Euro Dollar conflict. How that settles is anyones guess, as there is still an awful lot of Asian money flowing into the Euro. For the last five years, the weakness in Europe has been an additional cause of Sterling weakness., However the Sterling economy historically is far closer to the dollar economy.

Over the past thirty or forty years sterling dollar has ranged from Par to 2.40. Broadly however it spends most time between about 1.50 and 1.70. Middle value is generally put 1.60 to 1.65. Euro/dollar is more difficult, as they keep changing the basket of currencies. Before the accession of much of Eastern Europe, the long term average was a few cents either side of 1.25. Now with currencies that have only comparatively recently joined the Euro it is more difficult to assess but that is probably a bit on the high side (although the small size of the new additions complicates it further).

Dunroving's advice is very sensible. It is in fact exactly how Icover my foreign exchange risk.

Decide what level you can tolerate, what you cannot, and what would be a gift from the gods. Open an account with a Forex broker. Do bite sized chunks. Remember your counterparty risk is greater with most Forex brokers than with a high street bank , which is the reason for the bit size.. (But the brokers don't take 5 or 8 percent off you on every trade. Nor do they necessarily charge a commission for the privilege of doing business with them)

Most will let you "buy forward". I.E just at present Euro Sterling is the best (or worst) it has been for a year. This is not without risk, and you need to be very sure that you want and can afford to pay for the currency. But most will tell you how this works.

This forward buying is absolutely NOT a recipe for making money. It is simply a way of mitigating an existing risk. Neither I nor they have ANY idea where the Euro will be in 6 months time. Nor does anyone else. I have lost count of the number of people I knew who were certain they knew where a value would settle. One in a hundred was right. The other 99 are flipping burgers.