The pound has fallen to a 4 month low against the Euro because of fresh concerns about the extent of the UK's public sector debt levels.
One €uro rose to as high as 0.9057 pence in Friday trading, the single currency's highest trading position since May. The pound's falls came as official figures showed UK's public sector net borrowing totalled £16.1bn last month. The Government's overall debt now stands at £804.8bn, or 57.5% of GDP, which is an increase of £172bn in the past year.
Analysts advise that the £ was also weakened by speculation that the FSA has set Lloyds Banking Group the task of raising more than £20bn to strengthen it’s balance sheet if it wants to leave the Government Asset Protection Scheme (GAPS). Such news has hurt the £ as it suggests that it will take longer for the UK banking sector to return to normal.
So, having seen expectations of the £ trading at 1.20 or even 1.25 against the Euro for the year end, the picture has now been totally revised and experts are waiting to see how the currencies move during the final quarter of the year. We have seen highs of 1.2917 back in Oct 08 and lows of 1.0249 in Dec 08, highlighting the importance of using a specialist currency dealer when you move money between currencies. For a 250,000 € house, for a UK buyer, the price could have fluctuated between £243,925 and £193,545, a staggering thought.
Monthly average rates for 2009 highlight the progress made until June since when improvement has halted and fallen back towards levels experienced in April.
Monthly average rates 2009
January 1.08962 EUR (21 days average)
February 1.12765 EUR (20 days average)
March 1.08771 EUR (22 days average)
April 1.11409 EUR (21 days average)
May 1.13034 EUR (21 days average)
June 1.1674 EUR (22 days average)
July 1.16157 EUR (23 days average)
August 1.15938 EUR (21 days average)
September 1.13592 EUR (14 days average)
Peter Elias (Agent Commercial), La Moinerie, 79500 Paizay le Tort, Deux-Sèvres, FRANCE
January 1.08962 EUR (21 days average)
February 1.12765 EUR (20 days average)
March 1.08771 EUR (22 days average)
April 1.11409 EUR (21 days average)
May 1.13034 EUR (21 days average)
June 1.1674 EUR (22 days average)
July 1.16157 EUR (23 days average)
August 1.15938 EUR (21 days average)
September 1.13592 EUR (14 days average)
Peter Elias (Agent Commercial), La Moinerie, 79500 Paizay le Tort, Deux-Sèvres, FRANCE
Tel: 00 33 (0)5 49 27 01 22 or Tel: 00 33 (0)8 77 07 58 99 Mob: 00 33 (0)6 62 28 02 25
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