Wednesday, 11 March 2009

Euro will plunge "within months"

On 12 January we wrote that the pound could recover against the euro in time for the summer holidays.

At the time the pound was worth 1.127 euros and $1.52. Now it is worth 1.086 euros and $1.38. So things have got worse.

Yet, an article in Monday's Telegraph sounded an optimistic note for the pound against the euro - just as we previously said.

According to the article, spread betters are betting on a correction to the euro in the coming weeks. David Buik of BGC Partners said: "Quite a significant correction in the euro is coming in the next few months. The European Central Bank is behind the curve in getting to grips with its economic problems." The euro, he went on to say, was at risk due to the slowness of European policymakers to react to the recession.

Don't buy your euros yet if you don't have to. Wait for it, but the pound could be on its way back.

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