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Wednesday 19 May 2010

Currency Matters for Euro Property Buyers in Canary Islands

Transfer talk
Get more for your money with Moneycorp's forward contract currency deal, writes Stephen Tiley

WHEN transferring money to Spain and Canary Islands it’s important that you get as many Euros for your pounds as possible.
Transferring your currency overseas – whether you’re putting down a deposit on a home or making regular mortgage transfers – is often left to the last minute, which can cost you thousands due to currency fluctuations.
Timing your transaction is key and you should never underestimate the value of a good exchange rate.
Currency markets are constantly fluctuating, so making your transaction at the right time can make a big difference to the amount of money you end up with.
The amount of money lost or gained over the last five month for example is incredible.
For example, buying a Spanish home in Fuerteventura or Gran Canaria for 150,000 euros on January 28 would have meant transferring £129,310.
Leaving it just four weeks to March 1, would have meant bringing over £137,299, or a staggering £8000 more.
Two months later on May 17 and you would have saved £8,500 needing just £128,755.
Currency experts like Moneycorp can tailor its services to make sure you trade when exchange rates are in your favour and save you money.
A forward contract is just one of the services a currency broker can provide to clients making international money transfers.
You book to buy or sell your currency in the future, at a rate you fix today. Forward contracts can help protect against adverse currency movements and can be used to lock into favourable exchange rates.
Since November there has been a huge fluctuation from 1.11 euros per pound in January to 1.14 euros in February and up to 1.17 today.
The lack of direction suggests a steady relationship between the pound and the euro but it would be fairer to describe the alliance as a marriage of inconvenience.
For the euro and the pound the underlying problems are the same ones that have dogged them since the end of last year; debt and politics.
The common thread throughout the election run up was the way investors had been following the opinion polls. The more level the two main parties, the more investors shrank from buying sterling.
The chancellor’s forthcoming budget on June 22 should finally provide the pound with some direction.
The woes of the euro stem almost entirely from the maladministration of previous Greek governments.
In a situation dating back to Greece's fudged membership of the euro (many warned against it), the Athens government of the day used financial derivatives to conceal the true scale of debt in order to meet criteria set for membership.
Fortunately for Greece the EU Commission has now put a rescue package in place, however some disharmony still prevails.
In particular many other EU countries are concerned that the unrest in Greece may escalate to their own doorsteps if similar measures are put in place.
With all this uncertainty, let Moneycorp take care of all your money transfers to and from Spain; however small or large.
Our experts make the process quick, easy and highly cost-effective.

For more information on how Moneycorp can help get you more currency than from your bank contact Stephen Tiley in the Costa del Sol office on +34 951 319 700 or email and please quote Goldacre Estates

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