Time to get cosy with your weekly FX updates, where we break down what’s been happening in the currency world and how it might impact your international exposure. Probably not as exciting as the Premier league being back this week, (although we think it is) but just the FX essentials you need to know!

Key Updates:

• GBP: Holding firm near 13-month highs. Clearing 1.31 against the Dollar.
• USD: Continued to slide as the Fed signals possible rate cuts.
• EUR: Strong but facing mixed signals from economic data.
• Swift Payments: 89% of transactions now processed within an hour.

GBP

The British Pound remains near its 13-month high against the USD and other major currencies, supported by strong wage growth in the UK and a cautious stance from the Bank of England​ (OFX (US)).  August PMI data signals another solid expansion of UK private sector output, supported by a robust upturn in new order intakes.

This strength is great news for UK based importers and international businesses buying other currencies, though it means higher costs if or being paid from overseas.

USD

The US Dollar has continued to weaken, dropping by 1.3% as markets adjust to the increasing likelihood of Federal Reserve rate cuts​ (Monex USA). This trend is significant for anyone dealing with USD conversions or payments, as the dollar’s reduced value means it won’t stretch as far in foreign transactions. If you’re planning large USD transactions, consider acting quickly to lock in more favourable rates.

💡BLK.FX Top Tip: If you send or receive USD, we advise to monitor the situation closely. Timing your transactions could save you money as the Dollar continues to show weakness.

EUR

The Euro has managed to maintain its strength against the USD, supported by stronger-than-expected trade data, even though the economic outlook remains mixed​ (OFX (US))​ (FXC Intelligence).  The Eurozone's headline PMIs beat expectations, the details show this was likely due to a temporary bump caused by the Olympics. In fact, Germany's PMI results suggest the bloc's largest economy is once again flirting with contraction.

The Eurozone Central Bank will likely cut interest rates again in September, which can help shore up sentiment and activity, but it will potentially limit the Euro's ability to strengthen.

In Other News...

In a significant development, SWIFT has announced that 89% of cross-border transactions are now processed within an hour​. This is a major improvement, far exceeding the G20's target and making international payments more predictable and efficient, and a huge reason why we use the SWIFT network too.

For you, this means faster payment processing times, reducing the stress around timing and ensuring that your funds reach their destination more, well, SWIFTly.... Whether you're paying overseas suppliers, managing payroll across borders, or making large transfers, the enhanced speed and reliability of Swift's network should help smooth your operations and improve cash flow management.

My Final Thoughts:

With the USD weakening and the GBP and EUR maintaining their strength presents both opportunities and risks, depending on your currency needs. Staying informed will be key to managing your international transactions effectively.

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A note to please continue to use support@blkfx.co.uk in your emails as well as your account manager to make sure someone in the team can pick up your query as soon as possible.

If you need any advice or have questions about how these trends might affect your specific situation, don’t hesitate to reach out!

You can always reach us via email at info@blkfx.co.uk, on WhatsApp: +44 7939 432196 or via phone: 020 8064 0617 or any of the team via their direct emails