Japanese elections – it’s business as usual with easyMarkets

Japanese elections – it’s business as usual with easyMarkets

Uncategorized

While most brokers are increasing margins and changing trading conditions for JPY crosses ahead of the Japanese general elections happening on 22 October, easyMarkets and its clients’ trading conditions will remain unaffected.

“We are happy to announce that easyMarkets will be conducting its business as usual and not changing our trading conditions whatsoever. We would like to ensure our customers that we are dedicated to client safety – proven by our handling of events such as the US elections last November, the Brexit referendum in June 2016 and the Swiss Franc collapse at the beginning of 2015.”

James Trescothick, Senior Global Strategist, easyMarkets

 

easyMarkets clients will have the exact trading conditions they had when they began with the company, regardless of what is affecting markets. As such, they will be able to continue trading any JPY crosses without any hindrance.

The confirmation comes as part of a raft of easyMarkets Risk Management tools and conditions. These include:

  • Guaranteed stop loss
  • Guaranteed take profit
  • No requotes or amendments
  • Negative balance protection
  • Fixed spreads – always

In addition, the easyMarkets team is available to assess and help traders with any concerns or inquiries they may have.

 

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk Warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you fully understand the risks involved and do not invest money you cannot afford to lose. Please refer to our full risk disclaimer. Easy Forex Trading Ltd (CySEC – License Number 079/07).

 

About easyMarkets

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Restricted Regions: easyMarkets Group of Companies does not provide services for residents of certain regions, such as the United States of America, Israel, Iran, Syria, Afghanistan, Myanmar, North Korea, Somalia, Yemen, Iraq ,Sudan, South Sudan, British Columbia, Ontario and Manitoba.

 

First deadlock, then hope – the Brexit negotiation saga continues

First deadlock, then hope – the Brexit negotiation saga continues

United Kingdom
  • Brexit repeatedly shocking exchange rates (easyMarkets)
  • Leaked document signals hope for UK trade deal
  • Sterling bulls quick to rejoice at the hint of good news

 

Just like life, the currency market is a roller coaster. Take what happened on 12 October with the Brexit talks. First in the afternoon we had doom and gloom and then a few hours later we had hope.

In all divorces, one of the key areas that most lawyers will lock horns over is money. And the Brexit negotiations are proving to be no different. Michel Barnier, the EU’s chief negotiator, said that there was a “deadlock” over the UK’s so-called divorce settlement. He also said that the lack of progress on this matter was “disturbing”.

The UK was hoping that it would make some headway and at least agree to start talks on a future trade deal before the crucial EU summit on 19-20 October. However, this has yet to happen. In fact, Mr Barnier has said that he felt he was not in the position to recommend to the European Council to start discussions on the “future relationship.”

“With March 2019 fast approaching the lack of progress and the increased chances of the UK getting no deal sent shivers down the spines of sterling bulls with GBP crashing against both the USD and the Euro. The GBP/USD had fallen down to the 1.31310 levels and the EUR/GBP had risen to around 0.90184.”

James Trescothick, Senior Global Strategist, easyMarkets

 

Meanwhile, a leaked internal draft document hinted that the 27 European Union countries should prepare to discuss trade amongst themselves, which will pave the way to start negotiating trade talks with the UK Government in December. The paper underlined Mr Barnier’s earlier comments about a lack of progress, but also mentioned there had been developments on some key areas, which would please many.

Though this draft can at any stage be revised, it does show a tiny a bit of hope that a deal could be made before the UK’s official exit.

The market reacted swiftly to the news.

“Sterling bulls rejoiced. GBP/USD skyrocketed back above 1.32 reversing its previous losses of the day and at the time of writing is currently trading around 1.3264. The EUR/GBP did the opposite and crashed back down, falling below 0.9000 levels to trade around 0.8925. What a difference a few hours make!”

James Trescothick, Senior Global Strategist, easyMarkets

 

When Theresa May announced that Britain would honour its financial commitments to the EU, there was the belief that the fifth round of talks would finally bring some much needed clarity that a deal could indeed be made in time. Initially it looked like that the EU and UK were getting nowhere, but this leak has shown there could be a bit of light at the end of the tunnel.

We are still very much in unknown territory, but one thing that is mostly likely certain is that we will continue to get ups and downs with the Brexit roller-coaster.

James Trescothick, Senior Global Strategist, easyMarkets

 

 

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

About easyMarkets

easyMarkets® is an online pioneer market maker established in 2001. We’ve made trading markets as easy as possible with proprietary mobile, web and desktop platforms. Traders enjoy full markets access with a simple and powerful approach to CFD’s, forex and options trading.

easyMarkets® is part of an international network with offices in Europe, Asia and Australia.

 

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

 

 

What does Merkel’s hollow victory mean for the EU?

What does Merkel’s hollow victory mean for the EU?

France Germany Italy Uncategorized
  • Angela Merkel’s fourth term win was not the victory the market was hoping for
  • 13% of voters backed the anti-Euro AFD (Alternative for Germany)
  • Euro trading at 30-day low as a result

Following the twists and turns of 2016, this year started with much apprehension that the populous vote, which saw the surprise Brexit result and Trump’s ascension to the White House, would continue and spread throughout Europe.

First there was the Dutch election, with the controversial anti-EU candidate Geert Wilders at one point fancied to be the winner. As election day got nearer, his popularity amongst the voters vanished and he eventually lost. Big sigh of relief.

Then there was the French general election. Enter Marine Le Pen, another anti-EU politician with very strong right wing beliefs, who promised to call France’s very own referendum on EU membership if she won. She didn’t. Instead, Emmanuel Macron become President and the fear that the plague of populism would spread diminished. The Euro vs the USD skyrocketed on confidence that the EU will live on.

Combined with Mario Draghi’s more hawkish tone in his ECB press conferences, where he dropped hints that the end of the central bank’s net asset purchases may happen sooner rather than later, EUR/USD soared to the highest levels since January 2015.

Of course there was the German election on the horizon but good old Angela would have no problem with that. Right?

angela-2689111_1920

On Monday 25 September the market woke up to an Angela Merkel victory, but not the victory she and the market was hoping for.  Mrs Merkel had won a fourth term, however it was her party’s worst result in almost 70 years and she now needs to form a coalition. Not only that but more worrying rival party the AFD (Alternative for Germany), which is very anti-immigration and Islam and indeed the Euro, won 13% of the vote. It’s the first far right party to win a seat in Parliament in more than 40 years.

“Mrs Merkel now has to form a coalition, which won’t be an easy task. Germany could face months of negotiations as one is formed. Whoever is chosen to partner with Merkel will provide the political direction not only for Germany but also the EU and immigration.

“At the same time, Angela Merkel’s weaker positon will also make new efforts to work with French President Emmanuel Macron on Euro-area integration very difficult.”

James Trescothick, Senior Global Strategist, easyMarkets

 

As news spread of a disappointing victory, the EUR/USD opened with a gap lower, dropping from Fridays closing price of 1.19473 to 1.19143.  It continued to decline in both the European and North America sessions and as of the time of writing is trading at a 30 day low of 1.18145.  The EUR/GBP came under further pressure and as time of writing is currently trading around 0.87618.

After concerns of the Dutch and French elections vanished there was hope that political stability in the bloc was pretty secure and the surprises that were experienced and shocked the market in 2016 had gone, but Sunday’s election outcome has once again filled the air with uncertainty.

“This sudden turn in AFD winning as much as 13% of vote (bearing in mind the party itself only came into existence five years ago) shows that there is a swathe of voters upset with Merkel’s stance on immigration. It underlines that one of the great dangers to the European Union is indeed politics and general elections. In the current climate they have become incredibly unpredictable and dangerous to its actual existence.  AFD’s success in the election goes to show that the fear of immigration is still being used as a key tool in the black art of politics to cause upset and surprise.”

James Trescothick, Senior Global Strategist, easyMarkets

 

Italy’s general election is due by the end of May 2018. There are concerns that Northern League and the Five Star Movement – both Eurosceptic parties – could fare quite well.  The Five Star movement is gaining momentum in the opinion polls and the Northern League recently won local elections in Genoa and L’Aquila.

Italy’s economy the third biggest in the Eurozone is shaky at best with 11% unemployment and national debt at 133% of GDP. There is also a fascinating debate in Italy about the country stepping away from the Euro and introducing a parallel currency alongside it.

“Though the end of May seems a long way away, you may certainly expect the market to start to focus on this general election. With what happened in Germany at the weekend, you may expect bouts of uncertainty about the outcome and how it will affect the European Union.

“The feel good factor that was felt across the bloc after Emmanuel Macron’s election victory seems to have diminished. Though the Euro is still currently enjoying a bull run, which started following Macron’s win in France, the fear and concern which the market felt at the beginning of the year could start to return as we see out 2017 and prepare for what 2018 will throw at us.”

James Trescothick, Senior Global Strategist, easyMarkets

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

About easyMarkets

easyMarkets® is an online pioneer market maker established in 2001. We’ve made trading markets as easy as possible with proprietary mobile, web and desktop platforms. Traders enjoy full markets access with a simple and powerful approach to CFD’s, forex and options trading.

easyMarkets® is part of an international network with offices in Europe, Asia and Australia.

 

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

 

easyMarkets promotes Daniel Byrne to Managing Director, APAC

easyMarkets promotes Daniel Byrne to Managing Director, APAC

Australian United Kingdom
  • Byrne to replace outgoing MD Robert Francis
  • He joined easyMarkets as COO in May
  • easyMarkets CEO Nikos Antoniades praises Byrne’s “exceptional drive and talent”

easyMarkets, the premium-service global markets brokerage, today announced the appointment of Daniel Byrne to the role of Managing Director, APAC. Previously Chief Operating Officer of Asia Pacific, Daniel replaces Robert Francis, who is stepping aside after 10 years in the role of MD and will remain with easyMarkets in an emeritus advisory capacity to the board.

Since joining easyMarkets as Chief Operating Officer in May, Daniel has pioneered the company’s Active Traders Group, which brings institutional training, tools and best practices to retail traders. Available to easyMarkets members, the training program empowers both new and experienced traders with the tools and strategies to trade successfully.

In response to the success of this approach and growing demand from Australia’s self-managed super fund (SMSF) investors, easyMarkets has recently launched The SMSF Active Traders Group. The first of its kind in the industry, this new program equips SMSF trustees with the specific institutional-grade trading strategies, methodologies and – most importantly – the risk management framework they need to trade like a fund manager.

“I have always admired easyMarkets as a brokerage that goes so much further to support the successful trading outcomes of its clients. While never the cheapest option – the best option rarely is – easyMarkets’ emphasis on training and its premium level of service, with no hidden pricing, is unique in its ability to genuinely help clients become better traders. I am extremely honoured to take up this appointment and look forward to developing our offering throughout the region.”

Daniel Byrne, MD, easyMarkets

Daniel holds more than a decade of experience in markets trading and trading education, having previously managed premium accounts and driven global platform growth at multinational FX brokerage firms GFT Markets and AxiTrader, as well as being the Vice-President of the successful forex training firm, FXPlus Trading Academy.

“When we considered the idea of a new leader for the APAC region, we knew we wanted someone who understood the ethics and DNA of easyMarkets. It is Daniel’s versatile background and approach to trading which lead us to believe he is a perfect fit. Since being appointed as COO, he has shown exceptional drive and talent in leading the team and driving the business forward. He will therefore lead our strategic efforts to grow the Australian and the Asia Pacific market. We have every confidence in Daniel and wish him success in the exciting challenges ahead.

Nikos Antoniades, CEO, easyMarkets

Earlier this year, the firm also extended its unique dealCancellation feature – which allows traders to cancel a losing trade within one hour – to the platform’s mobile app.

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

About easyMarkets

easyMarkets® is an online pioneer market maker established in 2001. We’ve made trading markets as easy as possible with proprietary mobile, web and desktop platforms. Traders enjoy full markets access with a simple and powerful approach to CFD’s, forex and options trading.

easyMarkets® is part of an international network with offices in Europe, Asia and Australia.

 

Risk Warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

 

Divided Bank of England edging closer to raising interest rates, but unlikely to move in August

Divided Bank of England edging closer to raising interest rates, but unlikely to move in August

United Kingdom
  • Internal divisions over monetary policy at Bank of England
  • UK households should “prepare for interest rates to go higher”
  • Snap election and Brexit process likely to mean rates held rates in August

The Bank of England (BOE) appears to be at odds over how to proceed with monetary policy. This internal division was on display at the June Monetary Policy Committee (MPC) meeting when three policymakers dissented the central bank’s decision to keep interest rates at record lows.

Committee member Michael Saunders, who voted to tighten monetary policy, recently told UK households to prepare for higher interest rates.

I think households should prepare for interest rates to go higher at some point. But if rates do go up, it will be in the context of the economy doing OK and unemployment being low and probably falling.

Michael Saunders, Bank of England Monetary Policy Committee

Saunders isn’t the only one talking up an interest rate increase. Andy Haldane – another voting member of the MPC – clashed with BOE Governor Mark Carney last month by stating he was seriously considering voting for a rate hike.

Against this backdrop, traders are wondering whether the MPC will pull the trigger on a rate hike at its forthcoming meeting on 3 August. Given the 5-3 split in the June decision, it appears unlikely that the hawks will get the two swing votes they need to make it happen – at least, not yet.

At the same time, Brexit uncertainty will likely pour cold water on any attempt to tighten policy less than two months after the snap election.

The consensus appears to share this view, with only two of 80 economists polled by Reuters saying they expect a rate hike next week. In fact, these economists don’t expect the BOE to act anytime soon, as policymakers wait for wage growth to catch up with inflation. This means traders should expect the official Bank Rate to remain at its record low of 0.25% – perhaps until 2019. Based on the way they began, Brexit negotiations are expected to be a long and bumpy ride, giving policy doves all the justification they need to keep rates low.

James Trescothick, Senior Global Strategist, easyMarkets

The BOE eased monetary policy last August for the first time since the recession in response to the Brexit referendum. Although the British economy has had a resilient year, its outlook continues to be plagued by uncertainty. Official Brexit negotiations began last month.

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk Warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

 

Is Bitcoin teetering on the edge of the abyss?

Is Bitcoin teetering on the edge of the abyss?

World
  • $1k invested in Bitcoin in 2010 would be worth $1m now
  • Bitcoin and Ethereum account for 68.4% of the $100 billion combined market capitalization
  • ICOs currently taking place at a rate of around 20 per month

 

Over the last 30 days the original cryptocurrency, Bitcoin, has been receiving plenty of attention. In fact, the whole of the Altcoin market has featured in many a headline over the past month.

Bitcoin, which remains the leader of the pack, was first released in 2009. It was the first decentralized digital currency.  At the time, many skeptics assumed it was merely a fad that would soon vanish.

“I bet there are many out there now swallowing their words as we watch Bitcoin hit new all-time highs. At the time of writing it’s trading at around $2,500, from $11 back in 2011. I’ve read many articles demonstrating that if you had invested $1,000 in Bitcoin back in 2010 you would now be a millionaire. In fact, this did indeed happen to one young investor by the name of Erik Finman, who did exactly that and is now sitting on a fortune of $1.9 million. However, this attitude isn’t too far removed from saying, “if only you used these winning lottery numbers last week you would be a millionaire!” Hindsight is a beautiful thing.”

James Trescothick, Senior Global Strategist, easyMarkets

 

That said, the future of the cryptocurrency market is still unknown. Could an investment in a cryptocurrency today bring the same fate as that of Eric Finman?

There are now over 800 cryptocurrencies out there, with the combined market capitalization at $100 billion. However, the majority of this is made up by just a handful of high profile Altcoins, like Bitcoin (which makes up 40.1% of the market cap) and Ethereum (28.3% of the cap).

Every month sees around 20 new Initial Coin Offerings (ICO). An ICO uses a method similar to crowdfunding to release a new cryptocurrency.  The start-up firm behind the new cryptocurrency attempts to raise capital by publishing a white paper, which explains in detail about the project it is behind. The investor receives a token in return for the money he/she has invested. Early investors are incentivised to buy cryptocoins with the hope that they will go up in value if the venture is successful.

The projects of these start-up companies can vary in many different areas, from energy to gun safety, and there has been many a success story. A project called Bancor, for example, raised $153 million within a couple of hours. ICOs are proving incredibly popular, as investors hope that their chosen new cryptocurrency will eventually rise to the dizzying heights of Bitcoin.

“As amazing as they may sound, ICOs pose many problems. First, there is the obvious possibility of the project’s failure, and this stands true for pretty much any project or investment. Second, the ICO market is unregulated, so is exposed to more danger of fraud. There have been many cases of these ventures being fraudulent and there is no safety blanket to fall back on. Finally, there is the fear that the recent boom of this market is simply a bubble getting ready to burst.”

James Trescothick, Senior Global Strategist, easyMarkets

 

bitcoin-2057405_1920

Wall Street laughed its head off when one investor said back in February that Bitcoin would rise to $25,000 within the next decade. However, with the digital currency surging 400% higher over the last year, some now concede that this prediction could become reality.

Despite the recent success of Bitcoin and Ethereum, the explosion of new cryptocurrencies onto the market and the surge in new ICOs brings to mind the dot-com bubble.

Between 1997 and 2001 there was huge investment in creating internet-based companies due to the increased usage of the internet by businesses and consumers. The bubble eventually burst in 2002, with many of these web-based companies either shutting down or losing a huge amount of capital (although those that survived the financial massacre – the likes of eBay and Amazon – did bounce back and are now trading way above their pre-crash stock price).

“With the current lust for ICOs and the recent new high on the major cryptos, I can’t help but feel we could see something similar. The fact of the matter is how many cryptocurrencies does the market actually need? And how many can it use? Clearly 800 plus is an excessive number.”

James Trescothick, Senior Global Strategist, easyMarkets

 

Extreme volatility is certainly an issue. A prime example of this happened on 21 June, when Ethereum collapsed from $317 to as low as 10 cents before bouncing back. While these kinds of flash crashes can happen in any market, the manner of how the Ethereum crash happened and the severity of the drop go to show how fragile the cryptocurrency market is and how easy a sell-off across the board could cause a crash. This really is a brand-new market place with no real safe guards in place.

It seems that the likes of Bitcoin, Ethereum and LiteCoin are here to stay, with the world looking ready to embrace this new form of currency. However, many of the cybercurrencies out there will probably not last. With recent events like fraudulent ICO claims and the amount media buzz Bitcoin is creating, it is only a matter of time until some form of regulation and control are put in place. This will limit the number of ICOs and different cryptocurrencies.

For now, they can enjoy their time in the sun and all the admiration they are getting, as only time will tell how long they will last.

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk Warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you fully understand the risks involved and do not invest money you cannot afford to lose. Please refer to our full risk disclaimer. EF Worldwide Ltd

 

easyMarkets releases brand new trading app

easyMarkets releases brand new trading app

United Kingdom World

Industry pioneer easyMarkets have launched their brand-new trading app, a unique, free to download mobile app, based on their award-winning web-platform.

“We have come full circle from launching the world’s first web-based trading platform in 2001 to entering today’s fast paced era with the launch of our trading app. This is as always, another investment in our traders’ best interest and it is specifically designed to make their trading experience easier and integrated in their every-day lives.”

Nikos Antoniades, CEO, easyMarkets

The app promises to be fast, simple and easy – a tagline which carries the promise easyMarkets made to traders and kept for nearly two decades. Even prior to an official launch, the app has been very well received by 6000 active users.

“The easyMarkets mobile application was developed natively for both Android and iOS to maximize its responsiveness and provide our users with the best possible look and feel.

“It supports a broad range of functionality beyond trading, pricing and market news. Funding, withdrawing and reporting, enable the user to enjoy the complete easyMarkets experience on their mobile device. The new easyMarkets app is able to fully replace the desktop experience for its users.”

Alexander St Louis, CIO, easyMarkets

What sets this app apart from other trading apps is its ability to visually and contextually organize features in the most straightforward way. Traders are equipped with several market analysis and risk management tools as they make buy and sell decisions. They can also use easyMarkets’ unique trading tool, dealCancellation*, which for a fee, allows them to undo any losing trade within 60 minutes.

In a time of unparalleled demand for access to information through push notifications, the easyMarkets app taps into that need by providing traders with the ability to enable price notifications and receive around-the-clock alerts about the moves, highs and lows of trading assets.

Among many great features, the app provides graphs, live market news, a financial calendar and easyMarkets’ Inside Viewer which shows the direction fellow easyMarkets’ traders are favoring on a chosen asset.

Several upgrades are in the works which will allow further personalization based on trader preference, and continuous enhancement of user experience.

The easyMarkets trading app is available for download on iOS and Android, in English and Chinese and will soon become available in other languages.

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

*Terms & Conditions Apply

Risk Warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you fully understand the risks involved and do not invest money you cannot afford to lose. Please refer to our full risk disclaimer. EF Worldwide Ltd

UK versus Europe – where to invest as Brexit unfolds

UK versus Europe – where to invest as Brexit unfolds

United Kingdom , , ,
  • Currency fluctuations put volatility at the heart of many sectors (easyMarkets)
  • UK property investment offers exciting opportunities in new sectors (Properties of the World)
  • Spanish property investment provides long term lifestyle benefits (Kyero.com)
  • UK’s fundamental shortage of housing unaffected by Brexit (Aspen Woolf)

The UK will be very publicly facing off against the EU over the coming two years. Whether you voted for or against the split, the political and financial implications of the UK’s decision to leave the EU are huge. Now, Prime Minister Theresa May has called a snap election called for 8 June, in order for the Conservatives to take advantage of their largest lead in the polls over Labour in nine years (according to YouGov). Sterling’s turbulent journey since the Leave vote doesn’t look set to enter calmer waters anytime soon.

Sterling will be one of the most responsive barometers to the political machinations of the Brexit process. While many sectors will be affected by the UK leaving the EU, few react in real-time in quite the same way that currency markets do. The impact of changes in the pound’s value is felt in myriad ways, putting volatility at the heart of many sectors over the coming years.”

James Trescothick, Chief Global Strategist, easyMarkets

Property investment is certainly one sector that is sensitive to sterling’s shifting value. So should buyers be looking to pick up property in the UK right now, or investing their funds elsewhere? Sector experts’ opinions are divided.

“Those buying in pounds may find their second home overseas is suddenly worth a great deal more – or less – as the pound and the euro dance around each other. The same is true of the pound and the dollar, with the US experiencing its own unique style of political upheaval right now. UK buyers seeking stability from their investment might find it prudent to seek out domestic property investment opportunities over the next couple of years.”

Jean Liggett, CEO of visionary property investment consultancy Properties of the World

Liggett points out that domestic property investment still offers a wide range of opportunities. The UK’s hotel and care home sectors are offering some of the most exciting property investment possibilities at present.

While UK hotel investments often come with the benefit of two or more weeks’ use per year, many investors want a property that comes with the promise of sunshine, and continue to look overseas to make their money work for them.

“The fact that investors can pick up a property in Spain, use it themselves whenever they want, then leave it to their children as an inheritance or sell it a few years down the line, means that many British buyers are looking beyond short term currency fluctuations and pushing their pounds into properties in the Spanish sunshine. UK visitors to Kyero.com surged by over 30% in the year to March 2017, demonstrating that many are looking at investment in Spanish second homes over the longer term. The comparatively low cost of property in Spain also means that UK buyers can get more for their money when they invest abroad.”

Richard Speigal, Head of Research at Spanish property portal Kyero.com

For those seeking a purely financial investment, with no lifestyle benefits attached, the stability offered by buying in pounds is certainly a strong draw at present. The UK’s buy-to-let sector continues to perform well and the nation’s city centres look set to remain short of homes for many years, irrespective of Brexit.

“The UK’s decision to part ways with the EU does nothing to change the fundamentals of this country’s housing shortage. That shortage, along with a shift from ownership to renting, is driving demand for city centre homes like never before – and Brexit has done nothing to change that. Each year the UK falls further behind its target number of homes and until that alters, the logic of domestic buy-to-let investment is clear.”

Oliver Ramsden, Director of  Aspen Woolf

Ultimately, then, the decision on where to invest as the Brexit process unfolds will depend on the kind of benefits that individual property investors are seeking to get out of their investments, as well as how short or long term their outlook may be.

 

On the market:

Gramont House – care home investment from £75,000, based on a sustainable and ethical business model. 8% NET returns for 25 years, with four exit strategies and two purchase options. (Available through Properties of the World.)

Alicante penthouse – three bedroom, two bathroom penthouse apartment with large pool and tennis court on site. 600m from the beach. €185,000. (Available through Kyero.com.)

Eldon Grove – a refurbished, Grade II listed building housing 45 one, two and three bedroom apartments. Designed by experienced and successful architects. Prices from £94,950 with 7% NET yield assured for two years. (Available through Aspen Woolf.)

 

For more information, please contact:

easyMarkets: +44 203 1500 748 or www.easymarkets.com

Properties of the World: +44 (0)20 7624 5555 or www.propertiesoftheworld.co.uk

Kyero: www.kyero.com

Aspen Woolf: +44 203 176 0060 or www.aspenwoolf.co.uk

 

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

What to look out for in the new financial year – 3 predictions from easyMarkets

What to look out for in the new financial year – 3 predictions from easyMarkets

World
  • EUR/GBP could the currency pair to pay close attention to
  • Political instability could have a notable impact on gold
  • Sugar needs watching, with prices down 14.1% in Q1 2017

 

The new financial year is the perfect time to take stock of your finances and make some changes to ensure that the year ahead is even more profitable than the one before.

While the government uses April to increase taxes and cut spending, savvy investors are using the month to their own advantage.

“Many investors use the start of the new financial year to reassess their portfolio, with traders looking for new opportunities resulting from economic changes introduced by the UK government. April is the perfect time to look ahead and see what prospects the new financial year holds.”

James Trescothick, Chief Global Strategist, easyMarkets

 

According to the experts at easyMarkets, those opportunities are likely to be plentiful as the 2017/18 financial year unfolds. One currency pairing to watch closely right now is the EUR/GBP.

For the euro, the coming election in France is a major key. 23rd April is the first round and the expectation is that Marine Le Pen could win this round. She is very anti-EU and has said if she does win, then she will implement France’s own EU Referendum. The second round of the election is on 7th May. Le Pen is expected to lose this round, but the race is tight. EUR/GBP bulls and bears will be watching this outcome very closely.

Gibraltar is British territory and has been since 1713, though Spain disputes this and has asked on many occasions for joint sovereignty. Michael Howard’s comments on comparing Gibraltar to the Falkland Islands have not helped and goes to show that divorce proceedings will not be easy. Negotiations between the EU and the UK are expected to start in June.

The MPC official bank rate vote for the UK on 11 May could also impact on the EUR/GBP. The previous MPC vote (in March) caused a stir, as one-member voted for a rate hike. If other members join the call for a rate hike – or indeed if that member withdraws his vote to raise interest rates – it could give an indication as to if and when the UK could raise interest rates. Many believe the BOE is likely to raise rates before the ECB.

Bearing all of this in mind, the EUR/GBP is the pair to be mindful of over the next three months, as there will be a lot that could impact on its direction. The euro started to gain momentum against the sterling in December 2015, with the build-up to the UK referendum, and then picked up the pace after the shock result, spiking to the highest level against the sterling on October 2016 (the highest level since 1 January 2009). It has dropped back slightly since then, but is still trading at levels not seen since 2013.

The French elections are likely to cause volatility but the anticipation of Marine Le Pen actually winning is slowly dying down. Only a shock win for Le Pen could really put the EUR/GBP under pressure. As for the sterling, the ongoing political spat between the UK and the EU could cause movements, but the market is pretty much expecting this not to be an easy separation. For the pound, it will really be about economic data and hints of future rate hikes by the Bank of England that could give it support against the EURO.

When it comes to market predictions, the easyMarkets team has also flagged gold as the precious metal of the moment.

“Trump trade is losing momentum. On the back of Trump’s failed attempt to pass his healthcare reform through the Senate, there is now general consensus that he will also fail to pass some key fiscal policies such as tax cuts and infrastructure spending. The so called “Trump trade” relied heavily on Trump passing such policies. With hope on this waning, gold is showing signs of gaining strength.”

James Trescothick, easyMarkets

 

Gold is also showing resilience despite the fact that the Federal Reserve has raised interest rates twice within the last three months. 14th June will see another interest rate decision by the Federal Reserve, and though there was talk of two further interest rate hikes this year, with inflation currently holding where it is, there is now trepidation slipping in that there will only be one further rate rise in 2017. If this is the case, gold could benefit, so June could point us in the direction gold may go.

Political unease in Europe is also helping gold shine, with the likes of the Brexit negotiations and the French elections firmly in the headlines. There is also political unrest developing further in South Africa.

Gold survived a huge test in March, where it dipped below the key $1200 oz. level before bouncing back. With so much political instability at present, there is definitely enough uncertainty for gold to be attractive for investors. However, though it is trading (at the time of writing) at a five-month high, it could be all about whether the Fed will be aggressive and raise rates twice this year. Thus the outcome of the 14th June rate decision could be pivotal for gold.

As the new financial year unfolds, the easyMarkets team will also be keeping a close eye on sugar. Sugar had a bumper year in 2016, hitting highs of 24.05 cents per pound in September 2016 (a level it hasn’t reached since 2012). Since then it has fallen back and in Q1 sugar declined around 14.1%.

Brazil is the largest producer of the sweet commodity and production has increased due to the higher prices in 2016. Droughts caused by El Nino were largely responsible for the rising prices, having caused a production deficit by affecting several major sugar-producing nations in Asia.

“Now there are signs that, with increased production, there is a surplus of sugar, which could indicate why we are currently seeing a decline. There is talk from some analysts that the price could fall down to 15 cents per pound in the coming months. Looking at a weekly chart, there looks like there could be a potential Elliot wave developing, where sugar is currently in the middle of wave three on the downside. Sugar needs to be watched very closely over the coming months.”

James Trescothick, easyMarkets

 

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

Will gold shine bright for Britons as EU divorce proceedings start?

Will gold shine bright for Britons as EU divorce proceedings start?

United Kingdom
  • “The future of the Great British pound is most likely be unstable” (easyMarkets)
  • Brexit vote saw gold hit its 2016 high, while sterling crashed to 31 year lows
  • UK’s gold reserve ranks 17th globally (310.29 metric tons)
  • Gold’s correlation with US dollar means it’s not necessarily best option if pound collapses

It has finally happened. After months of speculation and political positioning, starting from the moment the Brexit vote outcome was revealed, on 29 March 2017 Mr Tim Borrow officially served the European Union (EU) with divorce papers. The UK will be leaving its long term partner, the EU.

Anybody remotely aware of market movements will question the next step for markets and the implications of this historic period for the EU. One particular area of interest will be how potential British Pound movements will affect gold.

“Let’s start with the lead in this soap opera: the sterling. Before the Brexit referendum, the GBP/USD was trading around $1.5007 levels. As soon as the results came out, it crashed to 31-year lows, making it the biggest one-day drop ever for the currency. The sterling continued declining and hit fresh 31 year lows at $1.1500 on 7 October 2016, due to an apparent “flash crash.” It has recovered slightly since then and is now trading back above a potential key level of $1.20. The future of the Great British pound is most likely be unstable with the major events happening in its mother country.”

James Trescothick, Chief Global Strategist, easyMarkets

What does that mean for gold? Any investor worth their weight in gold (pun intended) will know that the general rule is that, at times of uncertainty, many investors look to move their money into gold. It is a well-known safe-haven.

This has become obvious many times over, and emphasised by recent events. When the sterling crashed following the Brexit vote, gold sky rocketed to its highest level since March 2014. According to the Royal Mint (the UK’s official producer of gold and silver coins), during that same time there was a 32% surge in sales, as many Brits rushed to buy gold bars and coins. Britons also turned to gold during the subprime crisis in 2008, as well as the European debt crisis of 2012-13.

The UK as a whole does not offer the biggest contributions to gold. It ranks 15th among the biggest purchasers of gold bars and coins. Even the UK’s central bank does not show as much love to gold as others do – the UK gold reserves rank in 17th place globally. At the end of 2016, the UK’s gold reserve stood at 310.29 metric tons. The number only sounds impressive until it is compared with Germany’s gold holdings, which stand at 3,377.0 metric tons, or those of the United States, the number one country in gold holdings, with 8,133.5 metric tons.

“Why is the UK so reserved with its love for gold? Perhaps arrogance! The sterling has a key role as a global reserve currency, and it is still one of the top five most valuable currencies against the USD. However, now that the UK is standing on the abyss of uncertainty, further falls in the GBP may evoke a change of attitude.”

James Trescothick, easyMarkets

So will the pound’s future movements affect gold? That is always a possibility, but what it is important to recognize here is that gold doesn’t always follow the direction of the sterling. When the Brexit vote happened, gold hit its 2016 high while the sterling crashed to more than 30 year lows. However, in December 2016, gold fell to $1,120 oz, while the sterling was still freefalling against the US dollar.

Why would gold both rise and fall while the sterling was still on the same path? Because when gold declined it was mainly correlated to the rise of the USD on the back of Donald Trump’s presidency win, and optimism on the upcoming implementation of fiscal policies.

This demonstrates that gold tends to look at global economic sentiment and has a closer link to the direction of the USD than to the sterling. Future pound movements will not necessarily push gold in any direction, and if the GBP collapses again, there’s no guarantee that gold will be the best option to protect your money.

“Returning to where the story began, with the high profile divorce; if it creates the kind of mess that the market is currently expecting to see, it can potentially lead to a negative impact on global economy. A messy global economy has in the past led traders to gold helping the metal rise, and it may do that again. In the end it all depends on how this political soap opera plays out and unfortunately it will not be as predictable as an episode of EastEnders.”

James Trescothick, easyMarkets

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

https://www.statista.com/statistics/267998/countries-with-the-largest-gold-reserves/

http://www.royalmint.com/