Originally Posted by 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.

Originally Posted by 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.

Originally Posted by dunroving

If it's any consolation, when I came back in 2006, the dollar weakened to the point where it reached $2 = £1, just as I needed to exchange a large lump sum for the house deposit for my mortgage ($50k). Compared to that the current $1.65 isn't so bad ...

Originally Posted by 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.

Originally Posted by dunroving

Thank you for filling in the detail of what I was trying to say.

The dollar weakened against the pound from start to end of 2013, but it doesn't take much searching to find articles written at various points in the year, indicating either that the pound would weaken, the dollar would strengthen, or both.

For example:

"Fears are mounting that the pound is heading for parity with the single currency – meaning £100 would buy 100 euros rather than the 128 euros it would have last summer." (March, 2013)

"If consumer spending continues at the prevailing rate then there is a high probability that the British pound will show weakness in the future". (May, 2013)

"Sterling looking over-valued against the US dollar" (October, 2013)

Originally Posted by Editha

Well, I'm glad I don't look for tips from the Daily Fail, Zacks (who he?), or Forex Crunch then.

Originally Posted by dunroving

I just pulled the first three stories I came across.

Similar stories were also reported by Sky News ("quantitative easing likely to hit sterling further"), the Telegraph ("plummeting pound ... experts predict 20% drop"), the Guardian ("Analysts say the pound and euro could both weaken further against the dollar "), and the New York Times ("Pound falls against dollar and Euro ... further falls expected")

Any of those work for you?

Originally Posted by bigglesworth

There was one from one of the old merchant banks again a few weeks ago looking for sterling dollar parity. I cant remember which.

I am with you DR. There is always a so called expert proclaiming the death of the dollar or the rise of the remnimbi, or advising a sound investment in tulips.

Sometimes these guys are trying to start something, sometimes they are trying to protect position that has gone wrong.

The one thing they all have in common is they are "talking their book".

Originally Posted by rebeccajo

I can't see the point in converting to sterling just for the application. UKBA explains how they do the conversion in the rules. They use Oanda. I believe they use the date of the application but you can research that to be sure. I would move my money when it is advantageous for me not when I need to make a visa application.

Originally Posted by alfista1

You can't?
Well imagine that you have just saved up enough and sit on it for six months.
The week you apply the exchange rate changes just enough to fall a few pounds below 62500 and you are refused.
I don't want to take that risk.

Anyway we will need our savings in barclays when we move so might as well do it now no?

Originally Posted by Editha

Yes. I agree. That was my logic last year.

I wanted to buy a house in Britain at £X. At that point I had Canadian $Y tied up in my Canadian house which was worth £X at current exchange rates. There were forecasts that the dollar would fall against the pound at which point I would not be able to afford the house in Britain. So, I sold up in Canada and bought in the UK.

That way, if the forecast had been wrong, I'd still have the house in the UK, but if the forecast was right I was in profit. On the other hand, if I waited to sell and the forecast was right, then I'd not only lost money, but I'd lost the house I wanted to buy, or any house at that price level.

So, if I were you, if the current exchange rate is sufficient to enable you to have the right amount of sterling for emigration purposes, I would do the exchange now, rather than wait.

Also there was an article in Friday's FT which predicts the pound may strengthen further, but as has been conclusively proved by Dunroving, the opinions of financial experts are completely worthless.

Originally Posted by alfista1

You can't?
Well imagine that you have just saved up enough and sit on it for six months.
The week you apply the exchange rate changes just enough to fall a few pounds below 62500 and you are refused.
I don't want to take that risk.

Anyway we will need our savings in barclays when we move so might as well do it now no?

Originally Posted by Editha

Well, I'm glad I don't look for tips from the Daily Fail, Zacks (who he?), or Forex Crunch then.