Not sure it is going down?

Euro is going down, CHF is going up - GBP is somehow hovering between them?

Maybe because: Osborne increases VAT rate to 20%?

Swissie looks killer right now. But this week will be "interesting" with the G2(0) coming up, the chinese remnimbi partial float (and - LOL - it has actually strengthened, haha!) plus all the assorted cr*p that can hit the fan at any moment's notice...
Paul

I feel like groaning you for that post

The CHF is still a safe haven currency, EUR is still risky, GBP has just had an austerity budget . . . this makes it better than the Euro area, but still not as good as Switzerland.

The budget was priced into sterling already. The spirit of Osborne's budget was pretty well telegraphed ahead of time - VAT up; Cap Gains tax up etc. At the end of the day there was nothing missing and nothing new. So there were no real surprises today and hence no big reaction in the pound.

Don't forget that whilst future budget promises are all well and good there remains a huge legacy of debt in the UK which still needs to be dealt with. I still see sterling weakening against the Euro (from the current c. 1.20 level) by the end of the year. The austerity measures are more than necessary to mitigate the debt crisis and the damage to be passed on to future generations but will not aid short-term economic growth figures.

Why? Because of it's naivety or the fact that VAT is at 20%?

I think the SNB decided to stop keeping the chuff at it previous levels - it was costing them too much.

About "I still see sterling weakening against the Euro"

Not sure; there are still "unsurfaced" issues in the eurozone, for example, see the ECB statement this week & especially "Christian Noyer, governor of the Banque de France, appeared to go further than other ECB council members in admitting that “some banks have started facing increasing funding problems”.

There was a reduction in credit rating of a French bank this week & another wrote down value of holdings in the South; probably more of the same to come & not only in France?

My point on sterling is more that I feel the current rally is overdone - the rise up to 1.2129 this morning from a (admittedly very excessive) low of c. 1.03 at the start of '09 - especially given the UK debt situation is as poor as the Eurozone's worst culprits and far worse than e.g. Germany's.

VAT at 20%

Don't groan at the messenger . . . groan at George Osborne!

Anyway, you live in Switzerland now so the additional VAT disparity between Switzerland and the UK will allow you to be slightly more smug when you meet people living in Blighty.

Ah. In that case you need one of these:



Still as an expat it should be better for you/us/me. I don't think trading companies are going to whack prices up straight away which means that we will benefit from any export purchases made in the short term... (here's hoping anyway).

http://www.independent.co.uk/news/bu...n-2008703.html

Strange time to talk about increasing interest rates.

Anyway about the euro & from today's newspaper
"Legendary investor George Soros has called on Germany to leave the euro unless it willing to embrace a growth strategy, describing Berlin’s austerity doctrine as a threat to democracy and political stability in Europe."

He also said
"A collapse of the euro cannot be excluded"

There is a two way stretch on the euro between German success and the problems of the "Club Med".
Either one of these sides has to leave the emu (euro) or they have to magic up a new policy. It is unlikely that anybody can devise a policy that will bring two such disparate groups into monetary alignement.

Not it's not ...
Germany, Italy, Spain and Ireland are in dire straights, with various indicators (unemployemnt etc) being "massaged". The euro will go tits up unless there is some strong controls taken.

PS the CHF is way overvalued ... wonder how that will affect the economy. You won't see any non swiss tourists for a while ....

Germany is in far better economic shape than the UK, which is arguably as bad as any of the PIGS. Combined public and private debt in Blighty are truly shocking. As for unemployment being massaged - economically productive jobs in the UK are far fewer than surface unemployment data suggests following the massive increase in public sector employment over recent years.

Germany is in pretty good shape.

UK does have big problems but they seem to be starting to tackle them with the new budget without causing riots in the streets.

eur/chf hovering around 1.35 today; seems to be an unstoppable rise?

LOL - if anything a fall ;-)
Rumours have it that austrian banks don't look good in the stress test exercise.
EURCHF projectin potentially to 1.3380... but we're in no man's land at the momt...so who can say how far it will really go.
I wonder how SNB is manging their "position" in euroswisse...they're holding...err... quite a few billions of the unloved eurobucks
(chart courtesy of FT Alphaville)