Parents in England are paying several hundreds of thousands of pounds extra for their homes in order to get their children a place at top state schools. Read more
Goldman Sachs have announced this week that they will begin to move some staff from London to mainland Europe as part of its “contingency plans” to help prepare the investment bank for life after Brexit.
When a major institution like Goldman’s makes such a move, it is hardly surprising, in the current climate that the markets will pay close attention to the reasons behind it. Read more
Following the leak of the Panama Papers, offshore banking – and its capacity for exploitation by the rich – has been hitting headlines more than usual. Moreover, just before the 2016 anti-corruption summit – which took place in London at the beginning of this month – a large group of the world’s top economists put their names to a letter which called for an end to tax havens. Read more
Negative interest rates have made plenty of headlines recently. But are they effective in fighting deflation and encouraging economic growth? And what is their effect on international money transfer? Read more
It’s a tough time for the global economy: the increasing volatility of the Japanese and Chinese economies, Greece potentially exiting the Eurozone and tumbling oil prices are all contributing to growing uncertainty.
In this kind of climate, there’s usually one thing on investors’ minds – to ‘futureproof’ their assets. This often means moving them to ‘safe haven’ currencies. The last few months haven’t, however, seen the usual cash flows from unstable to stable currencies. What’s going on and what will it mean for international money transfer?
Slumping commodity prices have caused the Saudi Arabian economy to struggle, putting pressure on the long-standing ‘peg’ (fixed exchange rate) between the Saudi riyal and US dollar. This turbulence could have far-reaching implications for international money transfer – read on to find out more.
Most of us will know of the black market as the unlawful trade of goods and services. This is slightly different from the grey market, where trade occurs legally but through unofficial channels. So what exactly happens in shadow economies, and more importantly, what effect does it have on global growth and currencies?
Eastern trade is likely to expand at a rate not seen for centuries as China’s ‘New Silk Road’ looks set to go ahead, following the announcement of a $40bn investment in the planned trading route. The expansion of roads and railways from China across the globe means stronger links between all countries involved, but how will this affect eastern currencies?
One way to make the most of savings you’d like to grow is by tapping into new investment markets. This could mean looking abroad, in particular at countries that drive global growth. Today, emerging markets in developing nations are poised to do just this – become the world’s new growth engines. As with any financial investment, however, it’s important to measure and manage your risks. Here’s a breakdown on emerging markets and what investing in them means for you.
Free trade allows the flow of money from places that have it to places that need it – places of opportunity. That’s the theory. However, in 2010 the IMF, historically free trade’s staunchest defender, conceded that government intervention in markets and trade through capital controls could be justified. That debate has come to the fore again in 2015, as Greece has used them to stop its economy from spiralling out of control. We look at what capital controls are, when they’re used, and how they impact international money matters.
What are capital controls?
Currency trading might happen in pairs, but don’t let that fool you. In the world of international money transfer, every currency is interconnected, meaning local issues can trigger widespread changes. So whether you’re a German software developer, a British lawyer or an American accountant your finances are linked – in however small a way. Today, we’re going to explain how that works.
Among the biggest connections between seemingly distant economies are commodities like oil, coal, iron and other industrial essentials. Fluctuations in commodity prices can send tremors through the global economy.
For example, when oil prices started sinking fast a couple of years ago, oil-dependant countries like Venezuela, Norway and Russia all saw their economies (and currencies) devalue. Importers like India, by contrast, saw their economies (and currencies) benefit from lower prices.
If you’re transferring money to or from a country that’s dependent on a commodity, tracking changes in its value can tell you a lot about the health of your currency pairing. These are the kinds of factors foreign exchange brokers analyse, helping to get you the most for your money.
China is one of the world’s largest and most important trading partners, both as an exporter and as a growing economy drawing financial investment. That means that when Chinese shares fell by more than 8% at the end of July – the biggest one-day loss since 2007 – the impact on other emerging markets was immediate. The index used to track those markets’ strength dropped by 1.8%. Currencies including the Malaysian ringgit and South Korean won hit major lows. The reason? A chief trading partner’s economy was facing trouble.
As in the case of commodities, brokers pay close attention to these developments to protect your funds. They can use a number of tools to limit the impact on your finances, from ‘forward contracts’ to ‘fixed payment plans’.
Foreign exchange reserves
Buying and selling another country’s currency is a fundamental part of every nation’s fiscal policy. By building up a store of foreign money, known as ‘foreign exchange reserves‘ countries can influence exchange rates.
That’s what China attempted to do by purchasing US dollars and what Russia was aiming for by unwisely investing in the euro. In both instances, those nations wanted to devalue their currencies to create competitive prices on the global market. This has worldwide consequences: the value of reserve currencies becomes inflated, and countries with lower cash reserves can’t keep up.
But no matter where you’re sending money to or from, our brokers can help you safeguard against these situations. Find the right one for your needs with our international money transfer comparison tool.
Banks raising their interest rates might not sound like something to get excited about, but it’s a sure sign of faith in a nation’s economy. For the last six years, the Bank of England’s rates have been at a record low of 0.5% – a move designed to encourage borrowing and stimulate the economy when unemployment is high. Read more