The simple answer to this is yes, £1 is worth more than $1, just off this information yes you could say that the British Pound is stronger than the US Dollar nevertheless, this is not a true test for comparing one currency to another.
A true way to test the strength of a currency would be to look at it through its relative movement over time, from the past 50 years, the Pound has halved in value compared to the US Dollar.
On the 6th of March 1972, the Pound to Dollar rate reached a soaring high of $2.649.
That rate is the best the Pound has been against the USD since 1971.
Before the 1970’s there was a fixed rate set by the British Government.
During the 1800’s and the early 1900’s the rate stayed around $5 for every £1.
During 1940 the pound was devalued by the British Government to around $4 for every £1, there was then two additional devaluations in the 1960’s, the pound then became a freely floating currency in 1971.
On the 25th of February 1985, the Pound to Dollar rate reached a low of $1.054,
This was more the US dollar getting stronger on the back of an interest rate hike by the US Federal Reserve rather than the British Pound getting weaker.
In the two weeks following the Brexit referendum the British Pound fell 13% against the US Dollar, the reason the Pound fell was because Brexit created a huge uncertainty in the UK for the trade sector, emigration and the legal system for the future.
In March 2020, the GBP to USD rate fell 12%, many investors sold the Pound in favour of the safety of the US Dollar.
Nowadays it is so easy to find things online and this includes the GBP to USD exchange rate in addition to this, there are also a lot of websites that provide live exchange rates such as FX Street and XE.
The problem with this is that these rates that you are seeing are ‘interbank rates’ which mean that they are rates used by banks to exchange with other banks meaning that unless you are a bank, they are not appliable for you.
This bit of information is normally quite hidden in small writing, so it is hard to find.
Along with this, there are some sites that are not providing real rates, which is a real pain as you go through the effort of signing up just to find out that they rates are not real, and they still get paid for this as they get paid for the ‘click’.
When you look at exchanging your money, customers are often being misinformed.
To avoid being misinformed ensure that you get your quote from a bank or a currency broker.
The future is forever changing, its natural, it is the same with exchange rates.
You do not want to exchange your money at the wrong time as it could lead to a bad exchange rate at that time which can cost you a lot of money. It is remarkably similar to the weather when it comes to this, forecasts can’t always be trusted as they are unpredictable.
On most occasions the rate forecasts that can be found online are not accurate!
Some companies will try and use big words and terminology to try and make you believe them, a forecast is one person’s opinion, there is normally always someone to argue either side.
No one in the world can predict a forecast 100% accurately as it just is not possible to do and if it were, they would be making billions trading currencies! If they are hiding behind big technical terms, then generally I would not trust them!
Even though forecasts are not that accurate it is still important to stay alert on the exchange rates.
From my previous information above GBP to USD rates can have large swings, this can make a huge difference when you are going to exchange money.
Opportunities arise for buyers and sellers daily when the movements happen, regardless of what timeframe whether its days, weeks, months or years, there are always turning points within this.
We know it is not possible for a lot of people to be constantly keeping an eye of the rate, that is fine because as a currency broker we do that for you!
Not many people know what they are looking for either, so we do the looking for you; and that is one of the many advantages of speaking to a currency broker as we can do all of that for you!
Whether you are looking for a certain rate or a specific amount of money you acquire a currency broker will be constantly watching the exchange rates as part of their job!
Sometimes the smallest thing can trigger a large move within the rates, banks will not give you any help on exchange rates so you would have to monitor them yourself as it is not in their area of proficiency.
A lot of companies will give you a platform to login, quote you a rate and then leave the rest for you to do.
Most people are not comfortable using an online system or an app!
Furthermore, there is more room for mistakes when it comes to letting the customer do all the work especially if they have no knowledge in the area.
The timing and costs matter more, the larger the transfer is!
Regency FX are a UK based independent currency broker, specialising in high volume transfers.
We pride ourselves on our premium level of customer service, you will be allocated your own personal account manager whom you will have direct access to.
All funds transferred through Regency FX are made using client segregated accounts in accordance with the FCA (Financial Conduct Authority) guidelines.
The important thing is the comparison, online rates shown on Google and other search engines are not always accurate for the consumer.
They can often refer to the rates that banks exchange at rather than what is available to you, the customer.
Even if you are just looking for property at this stage it is worth getting in touch to discuss your options.
We can monitor the market on your behalf enabling you to budget more effectively.
As a first-class currency transfer service, here at Regency FX we endeavour to get the best available rate regardless of how much you are transacting.
Get a quote and see how we stack up.
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