Another week another ludicrous political idea. The implementation of FTT (Financial Transaction Tax) being suggested by John McDonnell, the UK Shadow Chancellor, may indeed be populist although has as much chance of becoming reality as Scotland winning the rugby World Cup.

This week we have a full data calendar so expect a volatile week going into the beginning of Q4. With the dark mornings set to edge in with a backdrop akin to Banksy’s Dismaland I think it wise to have a strategy in place to protect yourself from currency fluctuations over the winter months.


I expect the downtrend to continue with a test of the key support level at 1.50 in October. If you are a seller of USD into GBP I would look at covering off a percentage of your requirement on SPOT this week whilst leaving yourself some upside potential should we see it go to 1.50. Please contact myself or one of the trading team to implement a market order. Compared with where we trading at a month ago now is a good time to convert USD into Sterling. As I always say, doing nothing is speculating.

If you’re a buyer of USD then you will need to consider the point where GBP/USD will start to hurt and affect profitability. Is 1.51 a great level to purchase at? Nope. Is it better than being below your costed level of 1.50 and making a currency loss in effect on your deals? Absolutely. Please contact myself or one of the trading team to discuss your upcoming requirements from now till year end.


Risks are skewed to the downside on GBP/EUR for now. We’ve broken through support levels of 1.36 a few times and should we see a sustained break below 1.35 in October then I think this opens us up to my 12 month end of year forecast rate of 1.32. If you need to convert GBP into Euro I would consider a mixture of SPOT and market orders over the next three months. It is always an idea to be planning 3 months ahead to mitigate your risk. I would suggest to start thinking about your exposure and having a discussion with our trading team regarding forward contracts and costed levels for Q1 ’16.

As mentioned above we have a lot of data out this week –

·         Tuesday - BoE Governor Mark Carney speaking

·         Wednesday - Inflation data released from the Eurozone

·         Thursday – ECB Monetary policy statement

·         Friday – Eurozone PPI/US unemployment rate/US Non-farm Payrolls

Please do get in touch with myself or one of the trading team to discuss your individual requirements.

If you have any questions please let me know.

Have a great week.

Kind regards,

Liam Alexander