Help . . . Is The £ Going Into Free-fall?

[Mosha]

On msn uk this morning. The next UK interest rate cut could be as high as 1%

http://news.uk.msn.com/Article.aspx?cp-documentid=10672594

[alphason]

On msn uk this morning. The next UK interest rate cut could be as high as 1%

http://news.uk.msn.com/Article.aspx?cp-documentid=10672594

It seems to be widely reported that a rate cut is on the cards for tomorrow down to 3.5-4%, am I right in saying that a rate cut should lead to a further reduction in demand and therefore currency rate will worsen?

But this week I have seen that mortgage lending has risen slightly, Nationwides consumer confidence index has risen slightly and there is speculation the Govt will bring forward public spending - this will increase demand right? So are these measures enough to counteract the rate reduction, in respect to the GBP v Baht.

Basically is the time to change more GBP to Baht before or after the rate cut, or is the cut already factored into the current rate?

My Thai baht will run out end of this month. I realise its impossible to know for sure, I just wanted to check if my understanding was correct.

[skybluestu]

On msn uk this morning. The next UK interest rate cut could be as high as 1%

http://news.uk.msn.com/Article.aspx?cp-documentid=10672594

Sorry to be naive but is this likely to affect the exchange rate much? I have 5k I need to exchange in the next few weeks for the final payment on a house and I'm thinking the pound could get even worse after tomorrows predicted interest rate cut, is that what normally happens?

Thanks

[ace]

On msn uk this morning. The next UK interest rate cut could be as high as 1%

http://news.uk.msn.com/Article.aspx?cp-documentid=10672594

Sorry to be naive but is this likely to affect the exchange rate much? I have 5k I need to exchange in the next few weeks for the final payment on a house and I'm thinking the pound could get even worse after tomorrows predicted interest rate cut, is that what normally happens?

Thanks

Normally an interest rate cut will lead to a decrease in the relative value of the currency. So, yes.

But the week after, who knows? At some point you can expect a baht correction but I don't know when & if I did I'd soon be very rich.....

[chiang mai]

On msn uk this morning. The next UK interest rate cut could be as high as 1%

http://news.uk.msn.com/Article.aspx?cp-documentid=10672594

Sorry to be naive but is this likely to affect the exchange rate much? I have 5k I need to exchange in the next few weeks for the final payment on a house and I'm thinking the pound could get even worse after tomorrows predicted interest rate cut, is that what normally happens?

Thanks

Get worse, you reckon? Hmmm, you might just be onto something there!

[12DrinkMore]

Sorry to be naive but is this likely to affect the exchange rate much? I have 5k I need to exchange in the next few weeks for the final payment on a house and I'm thinking the pound could get even worse after tomorrows predicted interest rate cut, is that what normally happens?

The short term value of the GBP is based on market expectations. At the moment a rate cut of ?% is priced into the value of the GBP today, if the MPC cut more than the market expectation, then the GBP will tend to sink, if the the MPC cut less, then the GBP will tend to move up against other currencies.

However you also need to look at the THB, as it seems to be overvalued at the moment and the Thais might reduce the interest rate and/or stop manipulating the market, which would cause it to fall.

To be honest, I have given up trying to work out the best time to change money. It's an avoidable headache. So I transfer enough to keep my retirement account topped up once each year and then try to ignore the exchange rate.

[skybluestu]

On msn uk this morning. The next UK interest rate cut could be as high as 1%

http://news.uk.msn.com/Article.aspx?cp-documentid=10672594

Sorry to be naive but is this likely to affect the exchange rate much? I have 5k I need to exchange in the next few weeks for the final payment on a house and I'm thinking the pound could get even worse after tomorrows predicted interest rate cut, is that what normally happens?

Thanks

Get worse, you reckon? Hmmm, you might just be onto something there!

There are far too many idiots using this site who are too eager to knock an OP, as I said at the start of my post I'm not familiar with why currencies fluctuate so much and so was asking for advice, not some pleb to make a smart comment...get a life!

[chiang mai]

On msn uk this morning. The next UK interest rate cut could be as high as 1%

http://news.uk.msn.com/Article.aspx?cp-documentid=10672594

Sorry to be naive but is this likely to affect the exchange rate much? I have 5k I need to exchange in the next few weeks for the final payment on a house and I'm thinking the pound could get even worse after tomorrows predicted interest rate cut, is that what normally happens?

Thanks

Get worse, you reckon? Hmmm, you might just be onto something there!

There are far too many idiots using this site who are too eager to knock an OP, as I said at the start of my post I'm not familiar with why currencies fluctuate so much and so was asking for advice, not some pleb to make a smart comment...get a life!

We don't mind that you're not familiar with why currencies fluctuate but some of us are concerned at your lack of common sense! In a thread of 365 posts about the future of Sterling you come along at post 366 and ask more or less the same question that was raised in post number 1 - I find it ironic that you didn't both to read any of the other 366 posts to find your answer because the answers are there and really easy to see and read.

Edited November 5, 2008 by chiang mai

[JimmyTheMook]

I just got close to 35 baht to the $

Maybe the Brits can do Thailand a big favor and all go home......

[chiang mai]

I just got close to 35 baht to the $

Maybe the Brits can do Thailand a big favor and all go home......

I think you reached the limits of your debating capabilities with discussions about top loading washing machines, don't try to stretch something that can't be stretched.

Edited November 5, 2008 by chiang mai

[Soutpeel]

I just got close to 35 baht to the $

Maybe the Brits can do Thailand a big favor and all go home......

And I am sure the Brits in Thailand feel the same way about you....

[JimmyTheMook]

I just got close to 35 baht to the $

Maybe the Brits can do Thailand a big favor and all go home......

And I am sure the Brits in Thailand feel the same way about you....

You mean the ones who sit in "The Pub" all day smoking fags ?

[JimmyTheMook]

I just got close to 35 baht to the $

Maybe the Brits can do Thailand a big favor and all go home......

I think you reached the limits of your debating capabilities with discussions about top loading washing machines, don't try to stretch something that can't be stretched.

Guess you're really reaching with that comment as I never posted on that thread

But if being on top pleases you and yours all the better

[Soutpeel]

I just got close to 35 baht to the $

Maybe the Brits can do Thailand a big favor and all go home......

And I am sure the Brits in Thailand feel the same way about you....

You mean the ones who sit in "The Pub" all day smoking fags ?

Take it your a Septic then ?....figures..

[chiang mai]

I just got close to 35 baht to the $

Maybe the Brits can do Thailand a big favor and all go home......

I think you reached the limits of your debating capabilities with discussions about top loading washing machines, don't try to stretch something that can't be stretched.

Guess you're really reaching with that comment as I never posted on that thread

But if being on top pleases you and yours all the better

Help satisfy my curiosity,please. Why, in the middle of a discussion about currency rates relating to Sterling and the future of the Pound do you feel it necessary to chip in that all Brits should do Thailand a favor and go home? Logic, connection, appropriateness? Or were you just looking for attention?

[neil324]

I just got close to 35 baht to the $

Maybe the Brits can do Thailand a big favor and all go home......

Ah whats wrong do the big bad brits scare you

[JimmyTheMook]

I just got close to 35 baht to the $

Maybe the Brits can do Thailand a big favor and all go home......

Ah whats wrong do the big bad brits scare you

Who ? Simon and Nigel and their most recent beer bar venture ?

[skybluestu]

On msn uk this morning. The next UK interest rate cut could be as high as 1%

http://news.uk.msn.com/Article.aspx?cp-documentid=10672594

Sorry to be naive but is this likely to affect the exchange rate much? I have 5k I need to exchange in the next few weeks for the final payment on a house and I'm thinking the pound could get even worse after tomorrows predicted interest rate cut, is that what normally happens?

Thanks

Get worse, you reckon? Hmmm, you might just be onto something there!

There are far too many idiots using this site who are too eager to knock an OP, as I said at the start of my post I'm not familiar with why currencies fluctuate so much and so was asking for advice, not some pleb to make a smart comment...get a life!

We don't mind that you're not familiar with why currencies fluctuate but some of us are concerned at your lack of common sense! In a thread of 365 posts about the future of Sterling you come along at post 366 and ask more or less the same question that was raised in post number 1 - I find it ironic that you didn't both to read any of the other 366 posts to find your answer because the answers are there and really easy to see and read.

Sorry, because I'm at work and don't have the time to be online all day reading 365 posts, many of which are just people bitching at each other like schoolgirls, I thought this was a serious website where people could ask for advice from people who are more knowledgeable about certain things but it seems I'm wrong. And who's the royal 'we' anyway? You were the only one who bothered to have a dig at me!

[Soutpeel]

I thought this was a serious website where people could ask for advice from people who are more knowledgeable about certain things but it seems I'm wrong.

This forum is one of the better behaved fourms on TV, but does have its moments occasionally...

[chiang mai]

On msn uk this morning. The next UK interest rate cut could be as high as 1%

http://news.uk.msn.com/Article.aspx?cp-documentid=10672594

Sorry to be naive but is this likely to affect the exchange rate much? I have 5k I need to exchange in the next few weeks for the final payment on a house and I'm thinking the pound could get even worse after tomorrows predicted interest rate cut, is that what normally happens?

Thanks

Get worse, you reckon? Hmmm, you might just be onto something there!

There are far too many idiots using this site who are too eager to knock an OP, as I said at the start of my post I'm not familiar with why currencies fluctuate so much and so was asking for advice, not some pleb to make a smart comment...get a life!

We don't mind that you're not familiar with why currencies fluctuate but some of us are concerned at your lack of common sense! In a thread of 365 posts about the future of Sterling you come along at post 366 and ask more or less the same question that was raised in post number 1 - I find it ironic that you didn't both to read any of the other 366 posts to find your answer because the answers are there and really easy to see and read.

Sorry, because I'm at work and don't have the time to be online all day reading 365 posts, many of which are just people bitching at each other like schoolgirls, I thought this was a serious website where people could ask for advice from people who are more knowledgeable about certain things but it seems I'm wrong. And who's the royal 'we' anyway? You were the only one who bothered to have a dig at me!

We were starting to feel sorry for you and were going to tell you the answer to your question but since you called us school girls we've changed our collective mind. Anyway, what's all this nonsense about not having enough time to read posts, seems like you have plenty of time to write quite a few, hope you're not neglecting your work, too much.

[chiang mai]

Sally, did you buy USD, just curious to know what you decided to do? It doesn't look like the election result had any great impact on the GBP rate although it is continuing to fall, albeit slowly. I guess the next big watershed will be the BOE decision on Thursday - if the rate drops any more than 0.50 I reckon we'll see a substantial move in the rate but I suspect that anything less than that may already be built in to the current numbers, not sure. If it helps any I have some USD out there that needs to see 1.55 before I break even although I have other tranches at better rates that will compensate if not. Interesting to note that the US markets opened up by three points whilst the UK markets were down by two points, maybe that's the offsetting factor on the currency.

[cmsally]

Sally, did you buy USD, just curious to know what you decided to do? It doesn't look like the election result had any great impact on the GBP rate although it is continuing to fall, albeit slowly. I guess the next big watershed will be the BOE decision on Thursday - if the rate drops any more than 0.50 I reckon we'll see a substantial move in the rate but I suspect that anything less than that may already be built in to the current numbers, not sure. If it helps any I have some USD out there that needs to see 1.55 before I break even although I have other tranches at better rates that will compensate if not. Interesting to note that the US markets opened up by three points whilst the UK markets were down by two points, maybe that's the offsetting factor on the currency.

I have been sitting on the fence since yesterday afternoon. I almost did a transfer then it went slightly up again. It seems that we are almost up to 1.6 again depending where you check the rate. Maybe I should hedge my bets tomorrow morning in case the BOE goes a bit overboard.

Wonder how long the BOT can keep the US$under 35 ?

[chiang mai]

Sally, did you buy USD, just curious to know what you decided to do? It doesn't look like the election result had any great impact on the GBP rate although it is continuing to fall, albeit slowly. I guess the next big watershed will be the BOE decision on Thursday - if the rate drops any more than 0.50 I reckon we'll see a substantial move in the rate but I suspect that anything less than that may already be built in to the current numbers, not sure. If it helps any I have some USD out there that needs to see 1.55 before I break even although I have other tranches at better rates that will compensate if not. Interesting to note that the US markets opened up by three points whilst the UK markets were down by two points, maybe that's the offsetting factor on the currency.

I have been sitting on the fence since yesterday afternoon. I almost did a transfer then it went slightly up again. It seems that we are almost up to 1.6 again depending where you check the rate. Maybe I should hedge my bets tomorrow morning in case the BOE goes a bit overboard.

Wonder how long the BOT can keep the US$under 35 ?

Agreed that short term direction is uncertain at present but trend, for me at least, seems fairly clear. That view could however change in a heartbeat. This view from Barclay's Capital pretty much sums it all up:

"We think that the UK services PMI data released today are more important than usual. As always it is one of the indicators looked most closely by the MPC as it is the best guide they have to service sector, which is most of the economy. But this month’s reading is even more important, in our opinion. Q3 GDP was markedly weaker than expected and Q4 had previously been generally viewed as the start of the real problems. This month’s services PMI is an important gauge to how likely it is that Q4 GDP growth will be weaker than in Q3.

The market is currently pricing close to a 75bp cut by the MPC this week. The MPC could go 50, 75 or 100. We think 50 is the most likely outcome but a very weak services PMI number today (<43) could lead to larger cut of 75bp or 100bp. We are in line with the consensus forecast for a decline in the PMI services index to 44.5 from 46.0. Our view is if the MPC does cut rates by 50bp, GBP will see a modest sell off, but that a 100bp cut could lead to an immediate sell off and then potentially a rally. We continue to prefer remaining short GBP for the moment, but if the MPC do cut rates by 100bp, then buying the GBP on a dip could yield some short-term gains".

Maybe you should consider opening the USD account anyway, you don't have to fund it but at least it's there if you need it.

Good luck.

Edited November 5, 2008 by chiang mai

[Mosha]

How much longer though will Thailand take the pain? Their export markets are cutting rates. Surely the BOT has to see they cannot carry on with a relatively strong Baht. It's not as simple as going back to the family farm. Already plans in Indonesia, Malaysia, Thailand are in motion to cut rubber production by 210,000 tes next year. In Thailand that includes 400,000 Rai of chopped down trees. The EU have plans to stop importing farming products sprayed with Thai produced insecticides.

[chiang mai]

How much longer though will Thailand take the pain? Their export markets are cutting rates. Surely the BOT has to see they cannot carry on with a relatively strong Baht. It's not as simple as going back to the family farm. Already plans in Indonesia, Malaysia, Thailand are in motion to cut rubber production by 210,000 tes next year. In Thailand that includes 400,000 Rai of chopped down trees. The EU have plans to stop importing farming products sprayed with Thai produced insecticides.

Wish I had the answer to that one Steve, figuring out the meaning of life might be easier!

[Mosha]

Oh the meaning of life is 72

[KhaoNiaw]

Oh the meaning of life is 72

I think you'll find that should be 42!

[Mosha]

Inflation or thick fingers

[neil324]

I just got close to 35 baht to the $

Maybe the Brits can do Thailand a big favor and all go home......

Ah whats wrong do the big bad brits scare you

Who ? Simon and Nigel and their most recent beer bar venture ?

I reckon Simon and Nigel picked on you when you went to their bar for a quiet drink.

The brits out number any other nationality, that ain't going to change any time soon.

[MJP]

How much longer though will Thailand take the pain? Their export markets are cutting rates. Surely the BOT has to see they cannot carry on with a relatively strong Baht. It's not as simple as going back to the family farm. Already plans in Indonesia, Malaysia, Thailand are in motion to cut rubber production by 210,000 tes next year. In Thailand that includes 400,000 Rai of chopped down trees. The EU have plans to stop importing farming products sprayed with Thai produced insecticides.

Not sure whether Sterling has bottomed out yet, but remember last time the UK was in recession, the Pound rarely wavered from 38-40 THB. Okay, that was throughout the 1990's up until '97 crash. UK was in recession, Thailand was in boom. Now everyone's in recession . . .

Who knows . . .

All I know is the family budget just got halved.