Friday, Dec 21, 2007
Confirmation, not information this time
Reuters: Pound hits all-time low against euro
The pound hit an all-time low versus the euro on Friday as expectations of an interest rate cut on the back of a slowing economy led investors to sell the currency. The pound held near its lowest in more than a year and a half on a trade-weighted basis as news on Wednesday that the Bank of England's Monetary Policy Committee was unanimous on this month's rate cut firmed investor conviction that more monetary easing is imminent. A raft of negative data in December has also led to increased speculation that the Bank will cut rates aggressively in 2008.
Posted by alan @ 07:29 PM (491 views) Add Comment
5 Comments
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1. Bob A Job said...
Now the B of E is going to rob us poor people that have invested in risk free rates. They really are a bunch of twerps. How they can let credit expand to the extent it has, is amazing - they should be shut down.
2. Tippingpoint said...
Bob A Job
Be careful what you wish for. The BoE's replacement could be worse than it is. You have to understand that they are the only thing that is stopping the Labour government from completely stuff the pound. Just think how bad things would be if Darling was in charge. The Bank of England can only follow their remit and if their remit is to fix inflation against a basket case of fiddled statistics then that is what they must do. Things aren't made any easier when the government keeps filling it with stooges like Blanchflower. Thank heavens for Mervyn. He might tell it like he's giving evidence under caution but at least he talks sense.
As for the Euro, yes 1.38 is bad, but it's not awful. Lets just hope we've hit bottom. After all, if the Euro gets any higher the Italian economy will collapse all together.
3. European-bear said...
Bob a job....put your cash and investments into Euros (or at least a EURO deposit account). The £ will continue to sink as will house prices. When £1 = 1 EURO and house prices a down 30% then buy a house...you get double for your money with the appreciating EURO and sinking house prices. I have had my savings riding on the EURO stock markets and am gleefully looking at these potential double gains....
The trade UK deficit and budget deficit are very bad so the £ is toast....
4. handle_it said...
I guess I need to look at moving my savings into another currency. Any suggestions of how to, and what ? Seems the pound is being flushed down the same pan as the dollar. Why can't they just take the medicine now ? Clearly they're hell bent on avoiding the unavoidable.
5. Guiriduro said...
@handle_it - open an account with a good forex broker, e.g oanda fx, and buy EUR/GBP (buy a position in euros against sterling).