International money transfer

Protect your money from currency fluctuations when transferring it abroad

After last year, we did not need another reminder of how up and down the relationship between the pound and other major global currencies can be. Despite this, in her Brexit speech on January 17, Theresa May announced that Parliament would vote on the details of negotiations around the UK’s EU exit.

This, combined with the announcement of stronger than expected UK inflation figures on the same day, sent the pound up sharply against the US dollar: relative to where it had started, and it ended the day almost three per cent higher. This was welcome news for many, after the previous six months had seen the pound fall around 20 per cent against the US dollar as a consequence of the EU referendum vote and relatively stronger US economic data.

Unemployment down

The bounce generally sustained itself through to the end of the week. There was more good news for the UK economy as the Office for National Statistics (ONS) announced that unemployment was down by 52,000. While this announcement didn’t strengthen the pound, it appeared to help sustain its level following the small bounce against the US dollar.

The pound’s reaction against the euro on January 17 was less pronounced, although it was still up close to two per cent. The following day, as some European politicians responded to May’s confident Brexit speech with more sombre tones – and as the President of the EU Commission, Jean-Claude Juncker, suggested that Brexit talks will be “very, very, very difficult” – the pound gave back a little of its gains and fell a cent to close at €1.15

Currency volatility

It is clear that with Brexit negotiations on the horizon it is harder than ever to call the direction of sterling over the coming year. The constant flow of data around the UK and other economies has the potential to move a currency sharply, depending on the severity of the good or bad news. There are also political events to watch, namely Donald Trump’s policies and key elections in the Netherlands, France and Germany coming up this year. One thing seems certain though: it will be another volatile year for sterling against other global currencies.

What does sterling volatility mean to your payment?

If you need to transfer money aboard, whether it is to cover your living expenses abroad, property maintenance, sending a salary or even to pay for a wedding, then your money is susceptible to movements in exchange rates. As such, it is worth considering how you send the money across borders. We have partnered with foreign exchange specialist moneycorp, to offer our readers Mail Finance Money Transfers. Firstly, the service provides our readers with access to competitive exchange rates that are typically three to four per cent better than you would receive from a high-street bank, which could add up to £4,000 if you send £100,000 overseas. Plus, while banks commonly charge between £20£40 every time you make an international payment, the online transfer fee starts at £5 using moneycorp (and a maximum of £15 if you make a telephone transfer).

Fix the exchange rate

Moneycorp can take the hassle out of arranging regular overseas transfers, too. Its Regular Payment Plan enables you to set up repeat payments at any interval, whether weekly, monthly, or quarterly. Also, because you have the option to fix the rate for up to two years, you can also set it up so that you know how much money is leaving your account each time and budget ahead confidently. This will ensure that surprise exchange rate movements don’t have an impact on the amount you receive after the exchange rate transaction. You could also set up what is known as a ‘market order’, whereby if an exchange rate that you set is reached, then moneycorp will automatically book a deal on your behalf. All of this helps you to better manage your international money transfer and insulate your standard of living from any sudden volatility in sterling’s value.

Moneycorp has been in the foreign exchange business since 1979. moneycorp is a trading name of TTT Moneycorp Ltd which is authorised and regulated by the Financial Conduct Authority for the provision of payment services. All customer funds are safeguarded in segregated client bank accounts.

“Take the hassle out of arranging regular overseas transfers”