City A.M. billed it as ‘Shanghai Shockwave’ and that summed up the wider impact of China’s great sell-off. Stock markets tumbled the world over and mainstream newspapers conveyed public concerns over pensions and investments.
The currency market was also rocked. The pound weakened sharply against the euro as expectations of a Bank of England interest rate rise began to cool. Prior to the recent stock market slump, most had expected Mark Carney and co. to make a move at the start of next year. However, many commentators are now looking towards Q3 2016 for the Bank of England to shift from the record low rate of 0.5 per cent.
From €1.42 on 18th August, sterling slumped to €1.36 on the 26 August: a far cry from the 7-year high of €1.44 we saw in mid-July.
And whilst this news might bring some relief to UK exporters, it is less welcomed by those considering buying property in the Eurozone this year. With the GBP/EUR rate around €1.40 – as it has been for much of the summer – a €400,000 French villa would be priced at £286,000 in sterling terms. However, with the rate near €1.35, the same villa would be priced at £296,000 in sterling – a £10k increase in just over a week.
If you need to send money overseas to pay for a property – or have any other international payment requirements – it could pay to use a currency specialist rather than your bank. When it comes to moving money around the world, banks can be expensive: they can offer uncompetitive exchange rates and could charge high transfer fees.
To provide readers with a convenient alternative, City AM has teamed up with currency specialists Moneycorp to create City A.M. International Payments. The service offers bank-beating exchange rates, free online transfers and expert market guidance, which could help to save you thousands.
The recent movements in the currency market highlight the importance of having access to a personal account manager, which may not be available through your bank. Every Moneycorp client is assigned an account manager who will help to guide you through the process of transferring money overseas. They may also discuss using a ‘forward contract’ which can protect you from adverse price movements. For example, if you had been planning to buy in Europe but did not need to make the payment immediately, you could have used a forward contract to secure a rate near €1.40 – removing any concern when the market moved towards €1.35.
It is for these reasons that many City A.M. readers have switched from using their banks for international payments. If you are planning to join them, you will want peace of mind that you are using a secure service. Moneycorp has been in business since 1979 and last year traded over £13bn in currency on behalf of its customers. Moneycorp is authorised and regulated by the Financial Conduct Authority for the provision of payment services and customer funds are safeguarded in segregated client accounts.
City A.M. International Payments, powered by Moneycorp, offers great exchange rates and free expert guidance. For the exclusive City AM offer of FREE ONLINE TRANSFERS, open an account today.