By Alex Ellis

The euro was a hot potato during the summer months as investors moved to those currencies seen as more secure. One of these was the pound which benefited from large movements and swings as the economy was seen as much more stable and on a healthy recovery. However since the 30th June Sterling has lost 9% against the Euro and there are concerns that these losses could continue with the budget cuts next week and fears of an extension to the Bank of England’s Quantitative Easing programme.

How can you protect yourself in this situation?

The simplest and easiest way to protect yourself in this situation is to book a forward contract; this allows you to book an exchange rate for up to two years in the future. No one can accurately predict what the market will do but careful use of this contract can help prevent substantial losses. All you need is a small proportion of the overall value of your purchase to book a forward and then your position is secured.

Use Currency Line to contact an experienced currency broker and discuss this further, as with anything you will want to be well informed before committing yourself.