Sterling rose after a Bloomberg article yesterday (28 October) reported that a Brexit deal was closer into view as talks progressed. Both sides were participating in an intensive round of negotiations in London, and, on Thursday, the talks will move to Brussels. If more progress is made by 3rd of November, the UK Prime Minister Boris Johnson and European Commission President Ursula von der Leyen will then have to negotiate a final agreement.

Today, though markets remain nervous ahead of the US GDP and ECB meeting as the escalating Covid-19 pandemic has triggered renewed fears of a double dip downturn. With a second lockdown in France and new restrictions about to be imposed in Germany, investors are on edge.

Pound rises on Brexit progress

European Union and UK negotiators managed to resolve “some of the biggest disagreements that have long bedevilled the Brexit talks, raising hopes that a deal could be reached by early November, according to people familiar with the discussions,” Bloomberg noted.

According to the article, sources said that the deadlock has been broken after seven months of negotiations, but traders will still need to see more solid evidence to be convinced of any progress. The sources reported that both sides are working on “the text of an agreement on the level competitive playing field and are close to finalizing a joint document covering state aid.” They have also “moved closer to deciding essential aspects of how any accord will be enforced,” the sources added.

The news pushed the pound higher against the Euro and the majority of its G10 peers. While markets remain cautious, some economists believe that there are positive signs for reaching a trade deal.

The Brexit news should offer support to a pound that has been very sensitive to Covid-19 developments, at a time where lockdowns are devastating economies. In the event of a second wave the pound will definitely remain sensitive and could weaken, and analysts say that positive Brexit news might not be enough to support the pound in the current volatile environment. In this respect the upside potential for the pound is seen to be limited, as many more issues remain to be resolved regarding the Brexit talks, despite recent news.

Despite the recent doom and gloom, there are potential business opportunities to be had with Brexit, “from fishermen to airlines and insurers,” according to an article.

Risks to the pound

Sterling has been sensitive to Covid-19 updates and Brexit news, and it will remain so. According to Pound Sterling Live, “An obvious risk for those watching Sterling exchange rates is that negative Brexit news - which would most likely be a stalemate on fishing - combines with 'risk off' market conditions to trigger substantial declines in value.” But the stimulus support from Central Banks might be enough to support world economies and protect from unexpected currency declines seen in the aftermath of the first wave of Covid-19.

Are you Transferring funds abroad?

With the British currency remaining sensitive to Brexit uncertainty, you should get professional assistance when transferring funds abroad. Whether you are importing or exporting goods, paying employees overseas, or managing regular payments abroad, you need to be prepared and protect your business or your family finances from market volatility. Get in touch with Universal Partners FX to find out about efficient risk management and tailored solutions to your business’ transfer needs.

European automobile manufacturers have called on the EU to take a softer stance regarding the UK’s future market access, and they warned that the bloc’s harsh position could have long-term effects on the automobile industry. In June, more than 50 European and British food and drink trade associations wrote to Brussels to request for more flexibility, underlying the fact that a tariff-free trade agreement needed to be coupled with the assurance that businesses will be able to benefit from it.

Why does the manufacturing sector worry?

For UK and EU importers and exporters, it is important to maintain a frictionless access to the single market. Manufacturing businesses are aware of the damaging effects of Brexit and the ensuing disruptions to their sector. Brexit-related uncertainty has made it very difficult for most sectors to prepare for a post-Brexit business environment and reduced the possibility of securing investment.

UK manufacturing is integrated into the EU single market, as almost half of all UK goods imports and exports are with the EU. Many UK manufacturers are dependent on frictionless trade with the EU so their supply chains are not interrupted. With the possibility of a no deal Brexit, manufacturing sectors are concerned about a potential lack of regulatory alignment with the EU as no business wants to lose the privilege of free trade.  According to independent research from the UK in a Changing Europe initiative, some sectors, such as automotive, could be severely affected if they have to pay tariffs to export cars to the EU in the absence of any agreement with the EU. As they warned, “In almost all cases, Brexit will create additional financial or other cost burdens for companies: tariffs, customs declarations, certification costs, audits to ensure rules of origin compliance, loss of collaboration opportunities in R&D, border delays, EU customers switching to other suppliers, visa costs for EU workers, and so on.”

Letter from the European Automobile Manufacturers’ Association (ACEA)

In a letter from the European Automobile Manufacturers’ Association (ACEA) last week, the association which represents  some of the biggest car manufacturers in the world, including BMW, Toyota and Fiat, warned Brussels that some aspects of the bloc's current stance are "not in the long-term interests of the EU automotive industry.” The ACEA urged the EU to "reconsider its position" on tariff-free trade. In its letter, sent last Thursday, 15th October, the ACEA requested from the EU to reduce the percentage of car components manufactured in Europe or Britain so that the businesses can benefit from any EU-UK trade deal. The car manufacturers are urging that the new rules be introduced slowly so that the automobile industry has the time to prepare and adjust for the new rules and environment. For EU manufacturers, an agreement that provides tariff-free, quota-free trade on all goods is crucial.

EU chief negotiator Michel Barnier has told businesses that “short-term adaptation costs” were necessary to protect “long-term economic interests.”

Nicolas Peter, BMW’s finance director, has said in a press conference last week: "The European Automobile Manufacturers Association (ACEA) has estimated that it could cost car manufacturers and suppliers from 10 to 11 billion euros, so we need tariff-free trade. And even then, it must be seamless. We have a just-in-time production system, so customs administrative processing must be efficient."

Are you a Business Transferring Funds Abroad?

If you are an exporter or importer and worried about your international trade costs, and the volatility of the British pound, you should get professional assistance when transferring funds abroad. Get in touch with Universal Partners FX to find out about efficient risk management and tailored solutions to your business’s transfer needs.

If you are considering buying a dream home abroad or simply investing in a desirable location where you can rent your property or relocate for good, then you must have looked at Spain as your top destination. Well, you were not wrong, as Spain continues to top the list for places to relocate or buy a property abroad.

According to iProperty Management’s research, Spain, which is already the top destination for Brits,  was the most searched for country, with 690,360 searches, 37,600 of which were from UK internet users. Following Spain, with less than 194,000 searches was Canada.

Spain is especially popular with Brits who made up 69% of expats in 2018. According to the data, those who want to invest in a property that will see demand from expatriates looking to relocate, should consider Spain. Among the top five, France and Portugal have also been a favourite location for Brits and the two countries saw 484,800 and 212,280 searches, respectively.

The interest in these countries does not simply result from the fact they are beautiful and desirable locations for retirement or for vacation. They are members of the EU and thus residents living in each of them are allowed to move and work freely.

 Spain is cheaper than London!

If you are hoping to get onto the property ladder, Spain is a good option. There are plenty of reasons for that as the number of expats in the Costa del Sol could attest. But beautiful location, gorgeous buildings, sunny beaches and good food can simply explain why you would want to settle there.

If you are buying property, the choice of buying within a gated community such as those located in the towns of San Pedro de Alcantara and Estepona, can offer security and peace. According to the Olive Press, a three bedroom apartment in Estepona  will cost around £200K, whereas the same amount could only get you a studio apartment in London, for example.

Places such as Marbella and Banus are also appealing due to the fact that they are secure and provide a great lifestyle. But also other areas on the Costa del Sol such as Casares Costa. Estepona, for example is only 20 minutes west of Marbella and is relatively cheaper than other more sought-after locations while offering a more authentic flavour of Spain. Guadalmina Ata poses a more pricey location where one can purchase beautiful properties exceeding €2 million.

For many Brits, and due to Covid-19 and Brexit, Spain appears to be the ultimate destination where they can retire and feel secure, while remaining part of the EU. Indeed, the number of Brits buying property in Spain has risen a lot recently due to Brexit.

Just looking at the data showing where Brits are registered in Spain, is indicative of the places and the kind of appeal they have for different age groups. The British community is concentrated along the coast, in Alicante and Málaga, and more than a third of residents are over 65. Madrid and Barcelona are a favourite among the younger generations who want to work and enjoy a more busy lifestyle.

Currency Exchange

If you are buying a holiday home in Spain, it is important to consult a specialist foreign exchange company such as Universal Partners FX right from the start. UPFX can help you manage currency fluctuations by locking the rate, as the final price of your home could vary significantly from the time you made your offer.

When moving large amounts of cash, it is best to get in touch with UPFX’s currency specialists where they can offer you competitive exchange rates and the best value for your money. Find out what your money is worth by giving them a call or requesting a free quote.

There are many incentives to buying property overseas, especially when you choose to buy your dream home in a place such as Portugal. From the beautiful countryside to its beach resorts and golf communities, Portugal has a lot to offer. For those investors who are looking for a good opportunity, the country’s low taxes and its strong rental market are key to seal the deal.

But how is the current property market, and how does Brexit and Covid-19 affect your buying plans?

The price of a property can be severely impacted by various factors such as the state of the economy, both in the country of residence and in the country you are buying in, as well as supply and demand. You might also want to consider that the investment you are making now will not be affected by the political climate in the specific country. 2020 has been a difficult year, as many countries, including the UK are still dealing with the effects of the coronavirus pandemic and the prospect of further lockdowns, while Brexit is still looming in the near distance.  The pandemic has deeply hurt economies and has inevitably hurt property prices home and abroad, making earlier investments seem more affordable now, which is not necessarily a bad thing.  

Brexit will accelerate the process of buying a home

British buyers are trying to secure their property abroad and their right to residency by buying before the Brexit deadline. Estate agents predict that the autumn will be a busy time for buyers dominated by higher property prices until the end of December, indicating that it is perhaps better to start your research now and ensure you do not pay more for a house you could have got much cheaper earlier.

Portugal, for example, has taken steps to attract British buyers, especially retirees by offering attractive tax schemes. Portugal is ranked the best country in the world for expatriates.

NHR Tax Status

In 2009, the Portuguese government introduced the Non-Habitual Tax Resident status (NHR) to attract high value residents, and it offered reduced tax rates and some exemptions for the first ten years in the country. Until recently, NHR allowed most foreign pension income to be tax-free. However, the 2020 Portuguese Budget introduced new changes to the NHR approved by the Portuguese Parliament on Thursday 6th February 2020. According to it, there will be a 10% tax on the foreign revenue of British pensioners and other foreigners who move to Portugal, with those living there before 2020 not being affected. If you already have NHR status or applied for Portuguese residence before 1 April 2020, when the new regime came into effect, you can still be eligible for exemptions on your UK pension income for the remainder of your ten-year NHR period.

No matter what, the tax is much lower than that charged in other countries such as the UK and significantly lower than the Portuguese income tax rates of 14.5% to 48%. It is still considered very attractive to foreigners.

The proposed changes come to address specific tax regimes and visa schemes that offer EU residency rights in return for property purchases. Retired Portuguese nationals and residents outside the NHR regime cannot access such tax breaks, there has also been pressure for change from within Portugal itself.

Whether low taxes or the Portuguese lifestyle itself seem appealing to you, real estate agents argue that now is the right time to buy and transfer your money abroad to complete your property purchase. They see that confidence will soon return to the market by the autumn of 2021 and that the first few months of the year will present an even bigger opportunity to buy.

If you are a British buyer, and want to secure a strong investment opportunity, now is the time to get in touch with your currency broker. A currency specialist such as Universal Partners FX can help you navigate the current market while taking into consideration your specific needs, goals and your budget.

When considering buying your dream home in Portugal, Universal Partners FX can give you peace of mind when sending money overseas. If you want to schedule ahead and safeguard your funds, talk to one of their foreign exchange experts today.

Buying property in Cyprus has grown consistently over the recent years, with many Brits relocating in the Republic of Cyprus. While Covid-19 has hurt the market, interest in property continues as the market is slowly recovering. Paphos and Limassol, for example, are especially sought after as they offer amazing villas and luxury properties in beautiful locations, allowing Brits to enjoy the best of what the island has to offer. In such areas, foreigners constitute as much as 75 percent of the market. Last year, world famous Colombian pop singer Shakira and her famous partner Gerard Pique, who plays for Barcelona football club, bought an exclusive villa in the coastal village of Peyia in Paphos. Celebrities and Hollywood stars have for years chosen Cyprus for their vacations. Leonardo DiCaprio, Michael Douglas Catherine Zeta-Jones and John Malkovich, Elton John, Diana Ross and Rod Stewart are a few of the rich and famous who chose to spend their holidays on the sunny Mediterranean island.

Why Cyprus?

With Cyprus being warm all year round, having sandy beaches, and hospitable people, it is not surprising that it has become as popular as Spain’s Costa del Sol and Costa Blanca. The big difference however is that the island offers some beautiful but affordable properties.

Home prices on Cyprus are indeed much cheaper when compared to Marbella, Spain, or the Algarve in Portugal. Whereas a villa in Spain or Portugal would be about 400,000 or 450,000 euros ($475,000 to $535,000), a villa in Paphos would be half the price. Cyprus’s coastal property prices could “range from as much as $724 a square foot in Limassol district to as little as $423 a square foot in Paphos district.”

Before the pandemic, Russians and Chinese buyers were the top international buyers, with many relocating their families and acquiring European citizenship by investing in property. German, British and Scandinavian buyers, as well as buyers from Israel and the United Arab Emirates, Ukraine and South Africa have also preferred Cyprus, due to its location and its proximity to Europe.

Things to consider when buying property in Cyprus

Although some foreigners have bought houses in the illegally occupied area of Cyprus, these have usually been controversial due to the complexities and restrictions on home purchases on that part of Cyprus. As a recent article in the New York Times noted, “While European Union citizens with residency in the southern part of Cyprus can purchase unlimited properties there, others are limited to one apartment, house or plot….In northern Cyprus, the limit is four properties” but “buyers wishing to purchase a home there must confirm in advance that it actually belongs to the seller and not to a Greek Cypriot, because they may be exposed to criminal liability due to the political situation in Cyprus.”

Buyers across Cyprus should also be careful when buying a property, ensuring that the house “is free of any charges, mortgages or other encumbrances with the provincial land registry.”

When you decide to purchase a property on the island, it is usually recommended that you get in touch with a lawyer who will typically charge about 2,000 euros to serve as your local lawyer, protecting your interests and explaining the complexities of the market. When you are purchasing property, stamp duties range from 3 percent to 8 percent, depending on the property’s sale price, with the seller paying 5 percent real estate commission.

If you are considering buying your dream home in Cyprus, you should contact a foreign exchange specialist to assist you with transferring your money abroad, explain currency exchange, and hedge your funds from unpredictable currency movements. Get in touch with Universal Partners FX so you can have peace of mind when sending a large amount of money overseas. If you want to schedule ahead and safeguard your funds, talk to one of their foreign exchange experts today.

Buying property  in Greece after Covid-19 is on the rise as the Greek government is looking to make purchasing a home in the country easier and cheaper through a range of attractive measures.

If you are dreaming for a cheap retirement in warmer climates, then the new initiative by the Greek government might be just enough to persuade you to buy property in Greece.

Like many other countries struggling with the economic impact of the Covid-19 pandemic, Greece wants to revitalise the economy by incentivising foreign buyers to purchase their dream home in the land of the Myrmidons and other legends. One of the ways the government is trying to appeal to home buyers is by raising the tax-free ceiling on the supplementary tax included in the property tax surcharge known as ENFIA imposed during the bailout years. According to the Greek newspaper The National Herald, “the ceiling is 250,000 euros ($294,823.35) and may be increased to as much as 350,000 euros ($412,752.55) and the supplementary tax will be abolished once ENFIA comes under the jurisdiction of municipal authorities as of 2022. Earlier the government said it would offer European pensioners a flat tax of 7 percent no matter their income – it's 28 to 44 percent for Greeks – if the foreigners moved their tax base to Greece as a condition.” The condition for pensioners is that they “cannot have been a tax resident of Greece in the previous five years before the relocation and must be relocating from a country that has a dual taxation agreement with Greece.”

Greece’s Tax Incentives

Brits usually go to Spain, so why not Greece? Greece is making an attempt to attract British and other Europeans to relocate in the warm Mediterranean country and birthplace of Democracy. Known for the Parthenon at the Acropolis, its beautiful sun kissed islands and the romantic sunsets at Sounio, Greece is now appealing to pensioners through tax incentives. While many countries want to attract a younger generation, the Greek government is interested in luring Europe’s retirees. “The logic is very simple: we want pensioners to relocate here,” says Athina Kalyva, head of tax policy at the Greek finance ministry. “We have a beautiful country, a very good climate, so why not?” Kalyva said that the government initiative is centred on passing this new flat income tax rate of 7% for foreign retirees who will transfer their tax residence to Greece in the next 10 years. She explained: “We hope that pensioners benefiting from this attractive rate will spend most of their time in Greece. That would mean investing a bit – renting or buying a home.”

Greece wants to apply the flat rate not only to pensions but to other sources of revenue too. The chief economic adviser of the Greek PM Kyriakos Mitsotakis, Alex Patelis, said that “the 7% flat rate will apply to whatever income a person might have, be that rents or dividends as well as pensions. As a reformist government, we have to basically try to tick all the boxes in order to boost the economy and change growth models in Greece.”

After successfully dealing with the coronavirus pandemic, Greece wants to boost the brand name Greece, Patelis said. “Once the pandemic subsides, we believe capital and labour will move to places that did relatively better.”

As economics professor Platon Tinios noted, “it’s a good idea if pensioners have easy access to a decent health system and good links to airports, so they can go and see their grandchildren. And golf courses, too.”

If you are considering buying your dream home in Greece, you should contact a foreign exchange specialist to assist you with transferring your money abroad, explain currency exchange, and hedge your funds from unpredictable currency movements. Get in touch with Universal Partners FX so you can have peace of mind when sending a large amount of money overseas. If you want to schedule ahead and safeguard your funds, talk to one of their foreign exchange experts today.

The British Pound has remained under pressure on Friday, especially after Thursday’s losses due to disappointing news that the Brexit negotiations have hit an impasse. Today’s (24/07/2020) better than expected retail sales did not help push the pound higher against its major rivals.

Brexit and Covid-19

Despite positive macroeconomic data, the coronavirus pandemic and concerns about the state of the Brexit trade negotiations have weighed on the pound. As the Guardian reported, on Friday morning the release of “the retail figures are doing little to support UK stocks with the FTSE 100 down 1.36% and the more domestically focused FTSE 350 down 0.6%.”

Positive Retail Sales’ Numbers

The easing of lockdown in mid-June helped UK retail sales beat forecasts in June. The Office for National Statistics has reported a 13.9% month-on-month rise in UK retail sales last month, marking an 8% uptick. Even for former Bank of England policymaker Andrew Sentence, the figures highlighted that the UK was on its recovery since the Covid-19 outbreak. The retail sales’ increase was the result of consumers spending for DIY and home improvement products due to the lockdown, with shops selling hardware, furniture and appliances doing particularly well, and reaching near-pre-lockdown sale levels.

With the easing of lockdown measures, consumers preferred real physical shops rather than online shopping, as the ONS noted that the proportion of online sales retreated from its record peak in May. Online spending, however, remained at 31.8%, higher than February’s 20%. UK total retail sales are now just 0.6% lower than February before the lockdown.

ONS deputy national statistician Jonathan Athow said:

“Retail continued to recover from the sharp falls seen in April, with overall sales now almost back to pre-pandemic levels. But there are some dramatic differences in sales across the retail industry. Food sales continue above their pre-pandemic levels due to the closure of cafes, restaurants and pubs. Online sales have risen to record levels, and now count for £3 in every £10 spent. On the other hand, clothing sales remain depressed and across the high street sales in non-food stores are down by around one-third on pre-pandemic levels. The latest three months as a whole still saw the weakest quarterly growth on record.”

With the exclusion of fuel sales, due to the lockdown and limited travelling, the level of sales was 2.4% higher than in February. According to figures, Britain’s economy shrank by more than a quarter in March and April and recovered slightly in May.

Is the UK economy recovering?

Former Bank of England policymaker Andrew Sentence said that the figures highlighted the UK was on its recovery since the Covid-19 outbreak. The Bank of England’s chief economist, Andy Haldane, has also pointed to a V-shaped recovery with the economy growing by around 1% a week, something that many of his colleagues have questioned. The British Retail Consortium said that spending among large high-street chains was 3.4% higher this June than last year.

As investors await the release of more figures to confirm expectations of a sustained economic recovery, the pound will remain under stress with Brexit as well as the growing number of deaths from Covid-19. If you are buying a home overseas or want to transfer funds to family and friends living abroad, get in touch with our friendly  Universal Partners FX team. UPFX’s dedicated foreign exchange specialists can help you access the most competitive exchange rates and make your currency transfers stress-free.

With more businesses opening slowly due to the coronavirus pandemic and the impending Brexit transition period ending on 31 December, an increasing number of Brits are looking to buy property in France. Many Brits want to secure a French property before Brexit, while others have chosen France for their holiday home, as they can drive there by car or reach it by ferry.

In The Connexion, an estate agent highlighted the rising demand for French homes by Brits, saying that “the phones have not stopped ringing’” as Britons are interested in buying a home in France before the end of the Brexit transition period.

Staycations

In an article in The Times, interest in staycations has now become the norm, especially after Covid-19 where travellers avoid airports. But, the meaning of a staycation need not be limited to spending vacations on British soil. Brits remain interested in buying a home abroad, but they are now choosing locations that they can reach by car. Director of French estate agency Leggett Immobilier, Joanna Leggett, notes that “We have seen a 42% rise since this time last year in enquiries from the British for properties that they can drive to.” “If you can get in your car, go through the Channel Tunnel and be in your house without having to see anyone except passport control, that’s actually a really good option for people now,” she said.

Brexit and buying a house in France

The number of British people moving to EU countries has remarkably grown since the 2016 Brexit referendum. With the UK expected to leave the single market after January 1, 2021, and any British arrival to France after that date to be regarded as outside the European Union, many Brits have begun looking for their holiday homes in France. This has helped increase property sales and may also result in France overtaking Spain as the number 1 destination for Brits moving abroad.

As Joanna Leggett said, this has had a positive effect on the property market: "Our sales to Brits at the beginning of the year were up 38% [year-on-year] until March, 85% of them were for main homes.  Our website hits are up 87% for the English-language version of our site and enquiries on properties are going completely mad.  We have so many Brits with reserved bookings coming from July, we expect the next three months to be our busiest ever." She also remarked: “I think the mad panic does seem to be that the British want to get here and they want to find their property and to be in it to qualify for the residency that we get at the moment.” She added that the period between July and September will be the busiest as restrictions might ease for travelling. “We have said that it does take three to four months for a sale to complete, so if people do want to be in their house they need to have made an offer by the end of September to be able to complete by December,” she said.

What happens after Brexit?

While the negotiations are still ongoing and there are many issues still to be resolved, one thing that is certain is that Brits will still be eligible to buy and rent out homes in France, as well as stay in France for 90 out of 180 days without the need of a visa.

If they move to France before the end of the transition period, it is expected that their rights will be the same as now, including their residency status, healthcare and uprating their UK state pensions.

According to estate agents Leggett Immobilier, Brits will “still be able to move here [after the transition period], there may be a little more paperwork than would previously have been required.”

Currency Exchange

If you are buying a holiday home in France, it is important to consult a specialist foreign exchange company such as Universal Partners FX right from the start. UPFX can help you manage currency fluctuations by fixing the rate, as the final price of your home could vary significantly from the time you made your offer.

When moving large amounts of cash, it is best to get in touch with UPFX’s currency specialists where they can offer you competitive exchange rates and the best value for your money. Find out what your money is worth by giving them a call or requesting a free quote.

Buying property  in Spain, France, Portugal, Italy and Greece is back in demand, with property site Rightmove reporting 1million searches in one day.

As travel restrictions ease, interest in buying property overseas has reignited with the number of Brits searching for a place in the sun rising. The top five property locations for Brits are Spain, France, Portugal, Italy and Greece, according to search data from Rightmove last month.  

Rightmove sees a surge in interest in European destinations

Rightmove’s Miles Shipside said: “Lockdown has allowed many people time to re-appraise their lives, which has prompted lots of home-hunters to get serious about buying elsewhere in Europe. In particular, countries such as Spain, France, and Portugal have cultures that are familiar to us, and their warmer climates and reasonably priced rural stock will appeal to those who have been recently denied foreign travel.”

He added: “Social distancing would be far more straightforward if you’re lucky enough to be able to afford your own overseas pad. If other holiday-makers feel the same, then they may wish to rent your property, helping it bring in an income when you are not there. It’s still early days as we’re not out of lockdown yet and most airlines are still shut, but this is an indication that this has been a life-changing period for many who are re-appraising both how and where they want to live.”

According to Rightmove, enquiries to estate agents overseas reached the highest level since last June, with the number of new users on “Rightmove Overseas” being 41 per cent higher than the same month last year. Rachel Beaton, an overseas property expert at Rightmove, said that with the easing of the travel restrictions the demand for overseas homes rose to “record-breaking levels.”

Particularly, searches for property in Spain increased by a quarter compared to last June, with many estate agents reporting a surge in online browsing and enquiries for overseas homes in the month of June.

Estate agents at Savills told financial website This is Money that “its most viewed home online in Spain over the last month was a remote five-bedroom £572,475 home in Andalucía, complete with sweeping views of the surrounding countryside, 10 hectares of land, a large swimming pool and an olive tree lined driveway.”

Spanish digital platform allows Brits to apply for a mortgage online

With interest in Spanish property rising, Spanish retail bank, CaixaBank, is providing its online platform HolaBank for Western European citizens considering buying a property to apply for a mortgage. The new digital platform comes after the release of digital mortgage application MortgageNow, another service which allows potential international buyers of Spanish property to apply for a mortgage from their country. Clients eligible to use the MortgageNow are European residents with an interest in purchasing a property in Spain.

 

In 2019, the Spanish Land Registry reported more than 62,000 property purchase agreements, particularly focussing on the Mediterranean coast, a number that represents 12.5% of the national total.

If you are considering buying your dream home, you should contact a foreign exchange specialist to assist you with transferring your money abroad, explain currency exchange, and hedge your funds from unpredictable currency movements. Get in touch with Universal Partners FX so you can have peace of mind when sending a large amount of money overseas. If you want to schedule ahead and safeguard your funds, talk to one of their foreign exchange experts today.

The latest release of the UK inflation figures has failed to provide a boost to the pound. Despite the recent Brexit optimism, the pound did not rise further after the latest inflation figures which came in line with expectations.

The GBP did not react to the news that inflation fell to 0.5% during May as it was expected. Sterling’s upside is also considered to be limited as traders are expected to remain cautious ahead of the latest monetary policy update by the Bank of England on Thursday. The BoE is expected to keep rates at 0.1% and increase its quantitative easing programme by £100bn.

UK CPI

According to the Office for National Statistics, the UK consumer price inflation eased for the fourth consecutive month in May, coming at an annual rate of 0.5%, meeting expectations. Inflation has fallen after a record fall in fuel prices which dragged the UK's inflation rate down. This was due to the lockdown as May was the second full month of the coronavirus lockdown restrictions. This was the lowest annual rate recorded since the Brexit referendum vote in June 2016.

Economists said that this will inevitably add to the discussions of whether the Bank of England will likely take Bank rates into negative territory.

ONS deputy national statistician Jonathan Athow said: “The growth in consumer prices again slowed to the lowest annual rate in four years. The cost of games and toys fell back from last month’s rises, while there was a continued drop in prices at the pump in May, following the huge crude price falls seen in recent months. Outside these areas, we are seeing few significant changes to the prices in the shops.”

Rising prices for food and non-alcoholic drinks helped offset the pressure from the falling oil and petrol prices in May.

What economists say

Economist James Smith explained that the UK inflation will stay below 1% this year:

“The other argument that is often made in favour of inflation returning, is that governments and central banks are pumping vast amounts of cash into the system. But this is unlikely to lead to higher prices, at least in the short/medium-term. In the case of the government, its spending has so far been solely aimed at keeping firms and consumers afloat, rather than trying to stimulate demand (which by definition, is constrained by the ongoing lockdown measures). The bottom line is that inflationary pressures are likely to remain fairly muted for the time being. This, in turn, will keep the pressure on the Bank of England to maintain its current degree of stimulus, and we expect a further £150 billion of QE to be unveiled this week.”

Chief UK economist at Capital Economics, Paul Dales, also said that "May's further fall in inflation is probably only the beginnings of a prolonged period of very soft price pressure." This he clarified, will drive MPC members to ask for more stimulus to boost the economy on the BoE’s policy meeting on Thursday.

For many businesses and consumers, the year ahead appears to be a very tough one, with more pressure on households. Businesses and employers have been hurt, and there is generally pessimism about the status of the UK economy due to the coronavirus and a possible second wave of Covid-19 cases.

If you are a business sending money abroad and are worried about the pound’s volatility due to the current market conditions, please get in touch with Universal Partners FX. UPFX’s dedicated foreign exchange specialists can help you transfer your funds safely, pay employees and maximise the value of your money.