The Rise and Fall of GBP
 

Greetings!

Thought I would throw this out for discussion if anyone is interested.

As a pensioner, I keep a close eye on the exchange rate as any fluctuation can have a profound effect on my pittance of a pension. No doubt most of you would have seen the fall of the GBP in recent weeks/months from about 73 to 65 today. This prompted me to have a look also at the USD and AusD and the results are the same. So, I ask myself why? Could it be that PHP is strengthening with the Philippine economy or due to other factors. I can see why the GBP is falling with the uncertainty of Brexit and the new PM..... money markets hate uncertainty. But that is not the case in the US or Aussieland. So what could it be? Maybe the world trade war between the major economies are having an effect? But then I look at gold prices and they have jumped in the past few weeks. I have learnt some time ago that the prospect of a major war will cause currencies to lose value and conversely....gold to increase in value. Could it be that? Or a combination of the set of events I have outlined?

A few days ago whilst musing this subject, and looking at my dwindling bank balance, I looked at the GBP forecast. From memory, we can expect a further fall in the next few months to about 61. But good news is ahead.....the exchange rate is forecast to be 83 ....in 5 yrs time.

Oh well.....looks like a diet of fish heads and a bucketful of rice for me for a while.....

Enjoy!

Re: The Rise and Fall of GBP
 

Last October I was lucky, or smart still working that one out, and transferred a years worth of money at just about 72 mainly to cover for the inevitable FU with the Brexit deal, not disappointed there. Most of the local currencies have done well over the last year Indonesia, Vietnam, Malaysia etc as they have managed to catch a bit of work from China so as to avoid the "Made in China" label tariffs.

Best exchange rate I have had was 106 back in the early 2000s and when I had to pay the bulk of the house in 2008/9 it was at 91.

Re: The Rise and Fall of GBP
 

It's all about relative security in a currency down the road. Yes Australia and the US have economic issues. But people would rather have dollars at the moment than GBP. Another issue is Brexit which explodes innumerable trade deals, not only with the Continent, but internationally. Can the UK renegotiate those to the advantage of Britain vs. the one that they previously had within the EU? The EU just negotiated a deal with Mercosur (Argentina, Brazil, Paraguay and Uruguay). In some cases, these deals are hard for outsiders to mirror since they assure "preference" is given to partners and not outsiders. And given how Trump - who cheerled Brexit...not many other nations have come out to offer even potential deals. If they have exclusivity with the EU they may not even be capable of making one. And of course Trump is "America First" - one could expect a negotiating process that is far from equitable. Look at how reliable a partner he is...he threatened to blow up the NAFTA II with Mexico and Canada...after (falsely) claiming it was vastly better than NAFTA I.

Re: The Rise and Fall of GBP
 

Looks like the 61GBP/peso rate may be a bit optimistic, yesterday it dropped by one peso to just one point from being in the 61 range. I think fish heads may become a Sunday lunch luxury.

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The way things are going it will be 50 by the time Boris and his motley crew have stuffed it up for all except for their mates shorting sterling and on the fringes of getting amazing new contracts to meet government requirements. Should Scotland pull out of the UK , I will not blame them them if they do, then I will be first in queue for a lion rampant passport

Re: The Rise and Fall of GBP
 

Believe me I'm looking for my maternal grandfather s birth certificate as we speak

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It's at Ph66 to GBP and heading North. So looks like the kids will have supper this week.

Re: The Rise and Fall of GBP
 

If this is a british one , then I can maybe help.
PM me.

Re: The Rise and Fall of GBP
 

Slight drop back as I type which could be due to the usual cashing in on profits and the DUP has just rejected the PM's latest Brexit deal which could mean a further fall. Think it will be a roller coaster ride until 30 Oct then things will become more clear.

Regards

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I got 65.46599 today at HSBC Makati so I guess it had dropped back a bit.

Re: The Rise and Fall of GBP
 

Well when the so called 'Honourable' Members of Parliament reject Boris's Brexit deal on Saturday watch the Pound plummet. Brace yourselves, its going to be a bumpy ride until after the next General Election and possibly a second Brexit referendum.

Re: The Rise and Fall of GBP
 

Genius needed.

What to do with my GBP that are languishing in my UK bank account. At the end of the year Brexit is going to happen ( well that is the plan at the moment ). What is the GBP going to do, rise like a phoenix out of the flames of disaster or sink like a stone?

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I think there is every reason for a rise as $us is going to slide, so this may see an increase against php as well, this without Brexit

I am looking at gbp being an outperformer in 2021, upwards that is

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It all depends on whether a trade deal is accomplished. If a trade agreement is reached ( or a botched deal) with the EU my bet is the £ will appreciate rapidly. The £ is rising at the moment on the strength of a vaccine becoming available soon, and the weakness of the US$.
Whilst on the subject of exchange rates yesterday we had to send a large amount of US$ to China. Our local bank gave us 48.22 Php / US$ which was basically the mid range rate on the international exchange rate. The fee for sending US$ was US$ 45. An unbelievable rate, if we used a UK bank we would have got a much more inferior rate and still got charged for sending it.
We use XE currency company to send money to the Philippines from the UK. They don’t charge for sending it and their rate is much better than the UK banks, but there is no way they could match what we received from the EastWest bank Philippines.

Re: The Rise and Fall of GBP
 

Are you interested in GBP/EUR or GBP/USD (or maybe GBP/PHP)?

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I think with the change of administration the dollar will strengthen, the dow has already reached a record height. A strong dollar is never good for the pound.

Re: The Rise and Fall of GBP
 

GBP to PHP

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The BBC saying a UK/EU trade deal is close. The market seems to have been expecting a deal for some weeks with the pound rising so maybe no big further appreciation, but a No Deal would have surely meant a large fall.

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https://cimg1.ibsrv.net/gimg/british...5cdccea44c.jpg
It depends if you want something sourced from outside UK seen another post from somewhere else where shipping for a pair of gloves is now £36 up from £11 previously
Tescos recently said they would not be putting up prices post brexit which is rich considering that 10kg bag of rice recently went from £11 to £14.50 morrisons used to sell small packs of ham at a quid they are now £1.50

Re: The Rise and Fall of GBP
 

Watching with dismay the fall of the GBP which over the past 3 months has fallen by 5 PHP, the biggest drop in the last few weeks. The USD has held up well and indeed has just reached its highest level for some considerable time.

This indicates that it's not the PHP that's strong but the GBP is weakening. It may be that the Philippines trade deficit may well reverse the decline in the near future but I wonder what is causing the decline of the GBP. Another big drop yesterday could have been due to the poor local election results. Bumpy road ahead maybe?

Re: The Rise and Fall of GBP
 

Consensus seems to be inflation, about 7% pa now and forecast 10% end of year. Interest rates up to highest in 13 years to attempt to control inflation. Expectations of further interest rate rises coming.. The Ukraine effect on commodity prices and Britain so dependent on imports So growth forecasts down. Growth to go down further if more sanctions hit EU energy imports and therefore UK exports to EU.

No UK election for a while but one here. Does the likely winner have any surprising economic policies? We have no idea! Though the Philippines much less affected by the war in Ukraine. In fact it could benefit as China thinks again about invading Taiwan.

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It's deja vu the 1970's again!

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If the son of wins the eelction, he may well do. I would not be surprised to see a form of international no confidence being registered in the Phils economy. this may see the pesos lose value against a larger basket of currencies and this includes the UK.

Nothing stays the same

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Not so sure. The martial law period was effectively 1972-86. Culminating in EDSA. The youngest who could remember that getting into their 60s now and only those into their 70s the martial law years. Then how much do they know abroad? The Philippines was rarely covered in the main news. Disasters, Imelda's shoes and EDSA.
Here some will vote for him regardless of what they know as Filipinos are big on forgiveness. Others obviously don't know much. One article I saw described the school textbooks approach to martial law as overall "cursory".

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International/local markets hate uncertainty. I suspect this will be the key driver


As for local thoughts on marcos era being something to be feared...................only time will tell

The international political and business community will be watching carefully, no matter who gets voted in

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Hopefully it will quickly roll forward 30 years to the early Arroyo period when it was 106 to the pound.

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Unfortunately doing the reverse. P65 today. The Ph Peso doing badly too, but more due to US events than domestic ones. Whereas the Pound is being hit both externally and through worried perceptions of the effect of its abrupt change in economic policy .One generally seen as risky by the markets.

Re: The Rise and Fall of GBP
 

Just seen P63.8 this morning.

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Time for a thread title change

''The fall and fall of GBP''

if you are looking to sell up and go back to the Uk, wait a while and max out

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Why go back to the UK?

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i said ....... If

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Soon it will be too expensive to live here.

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Not nearly as expensive as the EU and UK.
Regarding the sliding Pound Sterling. How many times during the last 10 years have we seen it slide and then slowly recover. The economic indicators during the first quarter of next year will be the acid test.

Re: The Rise and Fall of GBP
 

Three main long slides then as you say recoveries which are getting slower.
https://cimg2.ibsrv.net/gimg/british...7988d9612a.png

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Having just came back from spending 15 weeks in the UK I beg to differ. Supermarket living is getting expensive here.

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I'm amazed with what you are saying about grocery shopping here.and there. Last time I visited the UK a few years ago the cost of a trolley load of ordinary groceries at a mid price Tesco level type supermarket was very noticeably much higher than here at a similar level grocery, at least double I would guess.. A rough assessment because some products are of different quality and you buy differently eg here I tend to avoid most imported items. But of that order.
Yes, you can get more for you money at an Aldi. That's more difficult to compare with here as often they are not places you want to shop in here. But I don't think it would change the difference much.
Then lately UK food prices have gone up officially by about 12% in the past year Here the official yearly rise is about 6%.
If you include less regularly bought products eg electrical goods it may be a more favourable picture. But you definitely get a lot more for your weekly grocery shop here.

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We regularly shop in Royal Dutyfree SBMA and the difference between when we left and returned was significant, some items up a good 20%. Cost of living here is offset by housing costs and fuel etc but the Philippines is not the cheap destination that it was 20 years ago. And for inflation being 6%, they must use the same mathematician that collates the covid results.