Growth exceeds expectations – Sterling Update

Growth exceeds expectations – Sterling Update

Here’s the latest currency news from our partner Moneycorp, to help you find out what your money is worth.


Incoming UK economic data has broadly surpassed estimates of late. Growth exceeded expectations, with quarterly GDP rising by 0.6% during Q2 on an annual basis. Furthermore, the latest ISM services and manufacturing PMI surveys also reflected worthy improvements, with services rising from 47.2 to a more respectable 49.3 throughout September, moving closer to the key 50 threshold.

UK retail inflation also declined to a yearly low last month, fuelled by a steep decline in food price growth, with shop prices rising by 6.2% last month. The data released by the British Retail Consortium reflected the lowest increase since September last year. The annual figure declined to 9.9%, slipping into single digits for the first time since August 2022.

The news will be a welcome boost to those struggling against the huge increases to their cost of living as we approach winter, with rising energy bills set to make a further dent into household budgets. Despite the recent declines, UK food price inflation remains higher than both the US and EU, with the long-term impacts of Brexit a clear drag on the UK economy.

In other news, confirmation finally came from the UK government this week that they have shelved plans for the HS2 railway extension from Birmingham to Manchester amid a flurry of ‘radical’ decisions at the Tory party conference. UK Prime Minister Rishi Sunak thinks that the move could save the government around £36bn, putting those savings into smaller, more local projects.

As of Friday morning, GBP/USD is still on course to post another negative week, with the pair currently trading around 0.2% lower overall, having reached a new cycle low of 1.2037 earlier in the week. However, the pair is witnessing a modest rebound, rallying to back over 1.22. GBP/USD has been suffering from both the surging dollar and changing dynamics on UK interest rates, given the BoE’s surprising decision to pause rate hikes last month after a welcome drop in inflation. That powerful combination has resulted in a total decline of over 7% after reaching a cycle high of over 1.3100 earlier in the summer.

GBP/EUR has remained in a holding pattern within a tight range between 1.15 and 1.1580 for the past fortnight, indicating that the pound and single currency remain fairly well-synched, at least for now.


At the time of writing, EUR/USD looks set to achieve a fairly unprecedented twelfth straight week of declines, with the pair slipping around 0.3% by Friday morning. Earlier in the week, EUR/USD also dipped to 1.0450 for the first occasion since December last year. The decline from the July high of 1.1275 has now surpassed the 7% mark. Of course, today’s US Nonfarm Payrolls still have the potential to flip everything around by the weekly close, but regardless, consistent declines such as these are fairly rare events without some form of correction.

Most of the movement is considered to be down to dollar strength instead of Euro weakness. However, markets remain sceptical of the ECB’s ability to raise interest rates beyond the current level of 4.25% after last month’s 0.25% hike, given the broad economic slowdown throughout the region.

This week has witnessed a more mixed outcome among key economic data, with an improved set of Services and Manufacturing PMI surveys released throughout the region, albeit from a particularly low base. Only German manufacturing was the standout underperformer, slipping to 39.6 over the past month. However, regional data still points toward a more cautious consumer, with Retail Sales declining by a further 2.1% on a monthly basis during August.

Looking ahead, the minutes of the previous ECB meeting will be released next week, with a further update on German inflation. However, given the importance and strength of the recent USD move, this could point to EUR/USD continuing to take the bulk of its directional bias from the dollar side of the pair.

Why Moneycorp?

With a Platinum Trusted Service Award 2020 from independent review site Feefo and 40 years of experience in the industry, FrenchEntrée has been recommending Moneycorp for more than 15 years. During this time they have helped thousands of client planning the best way to pay for their property as well as supporting them afterwards with any further payment from paying bills, mortgages to repatriating UK pension payments for those who have retired to France.

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Furthermore, we have worked with the same person at Moneycorp for more than a decade! You might be familiar with her as she often writes for our French Property News magazine. She has 13 years’ experience in foreign exchange, and is a qualified European lawyer with experience in European transactions. Mar will be happy to answer any questions or enquiries to support you through these difficult times

Opening an account is really easy and free of cost. You can register online or over the phone in a couple of minutes and for FrenchEntrée readers there are no transfer fees in any payment.

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  •  chuyển nhà uy tín
    2023-11-28 09:08:31
    chuyển nhà uy tín
    "Excellent post thanks for sharing."