It’s not a pause, but a skip – Sterling Update

It’s not a pause, but a skip – Sterling Update

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


Having bucked the broader trend and surprisingly increased during the previous month, Nationwide House Prices declined by the fastest pace in 13 years last month, highlighting the negative impact to the market from the plethora of BoE interest rate hikes over the past year and a half. House Prices decreased by a whopping 3.4% during May, with the annual fall accelerating from 2.7% during April. The Nationwide also believe that higher interest rates will weigh heavily on the sector, which sounds like a sensible comment, given the backdrop.

In separate news, the BoE also confirmed that overall mortgage debt of £1.4Bn was repaid during April, representing the largest net repayment since record began in 1993, as consumers scramble to reduce their overall interest burden. The UK also bucked the trend on weakening Manufacturing PMI’s, with the latest data increasing from 46.9, to 47.1. Markets had been expecting a weaker report, in-line with recent weaker manufacturing data elsewhere. However, the data still remains well below the key 50 threshold.

The pound has also seen a fairly strong week, with GBP/EUR surging comfortably beyond 1.1650 for the first time since the end of last year. Having declined from over 1.2600 to 1.2300, GBP/USD is also finishing this week on a strong footing, with the pair moving back over 1.2530, further highlighting the recent strength in the pound.



Weaker economic data continues to dominate the European agenda, with evidence this week that inflation has fallen at a faster pace than had been expected. Regional Harmonised CPI declined from 5.6% to 5.3% on an annual basis during May, having been expected to have fallen only marginally to 5.5%. Headline inflation, which includes the volatile groups such as Food and energy, slipped from 7% to 6.1% over the same period. There were also substantial decreases among German and French inflation data. French annual CPI dropped to 6% during May on a preliminary basis, data highlighted on Wednesday, with Germany’s inflation slipping a whopping 1.3% from 7.6% to 6.3% over the same period, to its lowest level in more than a year.

Despite the declines, ECB Chief Christine Lagarde, suggested that there was ‘no clear evidence’ that inflation had peaked, pledging to increase European interest rates further at the next ECB meeting, and highlighting that it is still too early for the ECB to lower its guard. In other economic news, Germany continues to suffer from weaker global manufacturing demand, which recently helped to push the country into a recession.

Having declined from over 1.1000, to under 1.0650, EUR/USD is currently attempting to find support and had moved back over 1.0750 as of yesterday (Thursday) afternoon. Looking ahead, next week’s Regional Retail Sales are expected to recover on an annual basis somewhat, after the 3.8% decline during March, with Regional GDP expected to remain at (or near) 0.1% during Q1.

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

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