Weaker Pound’s Implications for Professionals

There is no doubt Britain has been a casualty in the current financial crisis with the weaker pound under immense pressure. While speculation is difficult and always risky for the analyst, expert Forex firm, 1st Contact’s Ernst van Rensburg says there are possible trends one can identify for the foreseeable future.

Van Rensburg, 1st Contact’s Forex manager, says he believes the situation for the pound could get worse. “We will probably see it weaken in the foreseeable future; indicators at the moment show any increase or steadying in strength is unlikely” His advice to professionals is that they saving their pounds till the currency strengthens might not be in their best interest, because it might take some time for the pound to recover.

He believes the rand will retain relative strength in the current climate. “There is also a whole lot of capital flowing into South Africa through sport investment and there have been business acquisitions such as China buying into Standard Bank. So I think the future is quite bright regarding the Rand as a currency.”

“The pounds being sent home are now depreciating,” he explains. “Whatever one can store now in their home currency at present will be worth more if the pound depreciates. That is one way you can increase wealth, though it is speculative” he warns.

With such a variety of variables to take into account, “its during these times that I believe it is best for people to educate themselves as much as possible, no matter how much we all like to leave issues we find difficult to understand to experts”, says van Rensburg.

“The landscape is so volatile that I wouldn’t depend on a single source for speculative info. I would say its best for every individual to collect as much information as possible to make an informed decision.”

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