weird...What is happening to the pound??

In spite of 'expert' opinion once again telling us that the value of sterling will dive due to uncertainty of the EU vote, yesterday it climbed 1.84% against the euro and again today it has gone up another 0.45% this at a time when the vote outcome is finely balanced. Interestingly it has fallen against other currencies but the Euro has fallen even further.

Conspiracy theories will no doubt be rife but the FX market is a complete mystery to all as it seems to follow its own set of rules i.e. 'No rules'

For example, last time the ECB applied quantative easing to the eurozone the euro strengthened when all logic tells you it should have fallen.

That is one reason I am deeply suspicious of all forecasts predicting that the pound will fall by this percentage or that percentage if we leave.
Nobody has a clue. Even a friend who used to be senior at the BoE says that FX is a totally arbitrary beast and you shouldn't gamble on it.

 

Err it's gone up because the polls have changed after Jo Cox's murder.

 

But its still uncertain according to latest polls with 2 days to go and neithe does it explain why the euro has fallen against major currencies.

 

I think it's pretty clear that the polls changed from favouring Brexit to even Stevens so regaining some market confidence.

The Euro is a **** currency and a **** idea.

 

I agree wholeheartedly with the last sentence but am not sure that the swing and 'even stevens' as you say is sufficient to have caused a 6 cent swing in two days given that is more down to a weakening euro than a strengthening pound. As I said though the herding instinct is particularly noticeable in FX trading. They do spook very easily like those old Westerns where it doesnt take much to start a stampede.

Interesting times eh?

 

Don't think even the Brexits economic experts are saying the £ won't drop through the floor if we come out, good for exports not good for everything else

 

As far as ican see the pound strengthening is a direct result of the polls now favouring a remain. currency trading in itself is inherantly crooked as we saw with libor however the markets are usually a guide to how positive brokers are towards a particular outcome.

is there any reason for the euro to weaken so significantly right now????

 

This. I quickly graphed the exchange rate over the past fortnight and the bookies odds of Brexit. Note the similarity:

 

That's quite interesting...gamblers following the bookies !!

 

To be fair I have nothing but repugnance for the money markets who feed off people misery. True vultures who produce only despair.

 

Who's in them workplace pensions?.. For every pound you put in your boss takes out 2.

 

Maybe it has something to do with an influx of people buying Euros prior to their holidays in July/August
because they are expecting the exchange rate to nose dive, maybe, and I'm no money expert, this has boosted the pound?

 

Just out of interest how much business does the UK do with Europe as a percentage?
Ie What percentage of our import / exports.

 

It's extremely straightforward. Recent opinion polls have indicated a move towards "Stay" so the markets are marking the pound.

 

Sorry - should have read "marking up" the pound.

 

The EU buys 48% of U.K: exports. Don't know the proportion of imports but the only EU countries which have a trade surplus with the U.K. are Germany and Spain. All the 26 other countries buy more form the U.K. than they sell to the U.K.

 

You will no doubt be surprised that I agree with that sentiment, albeit wioth a slight qualification...

The modern financial markets in general I despise. 'Futures' traders and people like Soros.... ( fictional Gordon Gekko anyone) who make millions/ billions without actually producing anything of value. I fully understand that we need shareholders and stocks and shares to enable companies making stuff to break through the limited capital barrier as private concerns to expand and grow but people making fortunes buying and selling shares / gambling on futures etc when those actions can make or break companies and pension funds is not what was intended when share issues stared in the same way that fractionalisation and ending of the gold standard has distorted investment banking.

Without capitalism we would not have cars, TVs computers or any of the mdern day things we take for granted but unregulated capitalism and a totally free market as lauded during Thatcher years has distorted the balance. 'Greed is Good' was the mantra of 70s Wall street characters like Gekko
but never has it been more blatant as newer, and more devious, complex ways to screw over the working man who produces the things we need are invented by these parasites. Capitalism YES but tempered by regulations protecting us from unethical and illegal trends.

Rant over!

 

But they are NOT. So it isn't. The pound has not fallen much relative to other countries currencies. US, AUS etc. It is that the Euro has gone down much more than Sterling against the same currencies and so the pound, whilst it has weakened it has strengthened agaisn a weakening Euro.

So it is NOT straightforward at all!

 

Okayyyyyy so will this stop altogether if we exit the EU?

 

According to the press here, the Deutche Bank is advising people to invest in Britain in the event of a Leave vote. Some odd things going on.