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25 Eastcheap 2nd Floor
London EC3M 1DE
United Kingdom

+44 (0) 20 3880 0575

help@privalgo.co.uk

Office Hours
Monday - Friday
8:00am - 5:30pm

It’s been a brutal week for GBP sellers. Since last Monday, GBP/USD has pushed down from 1.39 to 1.36, while GBP/EUR dropped from three-month highs of 1.172 to lows of 1.155. All this comes against the backdrop of July the 19th ‘Freedom Day’.

Privalgo’s Currency Experts discuss global sentiment, vaccine passports and reasons to be cheerful about GBP.

After a volatile week, you may be concerned about your upcoming international payments. If so, book a meeting with a Currency Specialist today. We can discuss how to hedge against these types of risks.

Book a chat with a currency specialist

John Hallahan
Business Development Manager

Contrary to the current market opinion, I’m optimistic about GBP in the medium term. The bears have been overzealous and a correction is on its way.

For context, concerns around rising cases have poured cold water over the country’s ‘Freedom Day’. In turn, this has added to GBP/USD’s recent fall of circa 1.7%.

Yes, cases are rising rapidly, and the double-jabbed UK Health Secretary has contracted Covid, which never looks good.

But the crucial fact is this, and we shouldn’t forget it: In January, there were 1,000 deaths a day on average. Now, the average is around 19. In January, around 4,000 people were being admitted to hospital a day. Last week, it was about 700 a day.

Now, every business can operate as they usually would, which will further help the UK’s economic recovery and employment rate.

GBP has the capacity to regain its recent losses and push higher.

Harrison Hickey
Business Development Manager

The government is U-Turning at breakneck speeds. Despite usually being unphased by political events, I believe

First off, after being pinged by Test and Trace, Boris Johnson and Rishi Sunak went from being chosen for a special pilot programme that meant they didn’t need to self-isolate to conceding and staying inside.

Now, Covid’s big Freedom Day, where supposedly everything was to go back to normal has been dampened by the news that you’ll now need a vaccine passport to get into nightclubs and other packed events.

After 19 months of closure, this is a nasty surprise to the night-time economy.

What’s more, these U-turns undermine the government’s self-confidence in its own reopening plan. This could have something to do with millions of staff who won’t go to work, as they’ve been pinged by the app.

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Patrick Oakley
Business Development Manager

There were a number of things that spoiled the party on July 19th. But for GBP sellers, what happened to the state of the currency would be chief among them.

On Monday alone, GBP/USD fell almost 0.7%, and today it’s edging closer to below 1.36.

Although some of this is GBP weakness, we need to look at global risk sentiment to fully understand it.

Global investors are concerned we may now be entering a new phase of the pandemic, driven by the Delta variant. A new wave of infections could be at the gate.

This has galvanised a risk-off sentiment. Investors are moving their money to the safe-haven currencies, like USD, and out of risk-associated currencies, like GBP.

What’s most worrying is that even a country like the UK, which is miles ahead of some other developed nations in terms of vaccinations, is still feeling the pain of the pandemic, thanks to rising cases.

This is adding to the pressure GBP is feeling with the stock markets.

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