In this post I want to address the question: Is now a good time to exchange US dollars for UK pounds? This might be of interest if you’re in the United States and intend on holidaying or having a vacation in the UK, or you might even be looking to emigrate there. You also could find this article of of interest if you’re a US business owner interested in importing UK products back into your country.
Is the USD to GBP Exchange Rate Good?
At the time of writing, the US dollar to UK pound foreign exchange rate is 0.64, meaning that for each US dollar you exchange you get 0.64 UK pence.
Is that good? Well, back in late April the rate was 0.61, meaning you got 3 pence less for each 1 dollar you exchanged. In that sense, 0.64 isn’t bad. But on the other hand, back in early June the rate was 0.65, which is the highest its been in 2012, meaning it could be better to be honest.
Will the Exchange Rate Get Better or Worse in 2012?
This is hard to say. On the one hand, the fact that the US dollar hasn’t climbed above 0.65 since January suggests it doesn’t have much further to go. In that sense, if the rate hits 0.65, it could be a good time to buy your UK pounds.
On the other hand, the global outlook is deteriorating, especially because of the Eurozone crisis, which is likely to favour the US dollar. If a Eurozone implosion looks likely, for instance, the markets might turn to the US as a refuge from the fallout. That could boost the US dollar, in which case it could be worth waiting before you buy sterling.
But of course, if you decide to wait, then you’re essentially gambling, because no one knows what’s going to happen in Europe, and no one knows which way the exchange rate will go. If you want to hold off for a higher rate, you should be aware that this is a risky strategy, because the rates go down as well as up.
What Should You Do?
Before you buy your UK pounds then, you should ask yourself, “How much time do I have before I need the currency?” and, “How open am I to risk?”
If you have lots of time, and you don’t mind risk, you can wait and wait to see if the dollar climbs. If on the other hand you neither want to risk the rate falling, nor do you have time on your hands, it could be worth accepting that 0.64 is a good rate, and make the exchange. It therefore depends a lot on your attitude.
Want More Information?
I do hope this post has been useful. If you have any other questions about changing US dollars to UK pounds, feel free to visit us at foreign exchange dealer Pure FX.
Advice on Financial Markets
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