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Euro/Sterling

  • 09-04-2020 10:10pm
    #1
    Registered Users Posts: 150 ✭✭ skankles


    Could the Euro tank, have about 70k savings, considering buying sterling, is this wise?


Comments

  • Registered Users Posts: 448 ✭✭ costacorta


    skankles wrote: »
    Could the Euro tank, have about 70k savings, considering buying sterling, is this wise?

    Sterling or US dollar won’t be that strong either maybe buy Chinese yuan


  • Moderators, Business & Finance Moderators Posts: 7,818 Mod ✭✭✭✭ Jim2007


    skankles wrote: »
    Could the Euro tank, have about 70k savings, considering buying sterling, is this wise?

    If the primary currency of a major trading block tanks, then sterling will be like Monopoly money.

    The UK has massive public borrowing, serious private debt issues, has not produced a decent positive balance of trade in over 25 years and is about to walk away from all its trade deals on the eve of what seems likely to be the biggest recession in 100 years.... and you think that is a safe bet....


  • Registered Users Posts: 150 ✭✭ skankles


    Wasn’t sure. That’s why I ask wiser people than me.


  • Registered Users Posts: 2,419 ✭✭✭ antix80


    skankles wrote: »
    Wasn’t sure. That’s why I ask wiser people than me.

    It's not just a matter of which currency but also which bank. I'd argue €100 would be safer in a German bank than an Irish bank. And i dont know what to think about revolut wallets.
    You also need to consider what happens if banks collapse or require bailouts. Your euro savings are guaranteed by the government. You might not have the same privileges abroad.

    As for sterling.. It's quite weak at the moment. Would it really be so bad to convert some of your savings to sterling rather than keep them all in euro? At least it's some diversification.


  • Registered Users Posts: 3,337 ✭✭✭ dubrov


    Sterling being weak right now is a myth. It's been around these levels for about 8 years.

    I wouldn't see buying sterling as a hedge either if all your spendng is in Euros It would be a gamble.


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  • Moderators, Business & Finance Moderators Posts: 7,818 Mod ✭✭✭✭ Jim2007


    antix80 wrote: »
    I'd argue €100 would be safer in a German bank than an Irish bank.

    I'd argue you trade in hard facts rather than sentiment.... Germany has a history of letting banks fail and in general their banks are not as well capitalised as Irish banks...

    The Germans will not hesitate to let a bank go under if push comes to shove, nor will the Austrians nor the Swiss.


  • Moderators, Business & Finance Moderators Posts: 7,818 Mod ✭✭✭✭ Jim2007


    dubrov wrote: »
    Sterling being weak right now is a myth. It's been around these levels for about 8 years.

    Sterling has been weak for well over 10 years and will remain so for a very long time. You can't have a strong currency and fail to produce a decent balance of trade in over 30 years, it just does not stack up.


  • Registered Users Posts: 3,337 ✭✭✭ dubrov


    Jim2007 wrote:
    Sterling has been weak for well over 10 years and will remain so for a very long time. You can't have a strong currency and fail to produce a decent balance of trade in over 30 years, it just does not stack up.

    I'm just pointing out that it hasn't suddenly weakened recently. It is in its new normal range.

    What does a strong currency mean anyway? The UK Central Bank could double the value of sterling overnight if they wanted. Not good for stable economics if they did so


  • Registered Users Posts: 17,209 ✭✭✭✭ dxhound2005


    The Euro stayed low for a few years at the start, able to buy as little as 60 Pence at one stage. Has mostly been a lot stronger since the last crash. Whether this indicates a strong Euro or a weak Pound, I don't know, but the Sterling v US Dollar numbers would suggest a weak Pound. I have a memory of our Punt being very strong against Sterling at some times before the Euro.

    https://www.macrotrends.net/2553/euro-british-pound-exchange-rate-historical-chart

    https://www.macrotrends.net/2549/pound-dollar-exchange-rate-historical-chart

    I bought about 1500 Sterling when the Euro was worth around 93 Pence, and I could have sold it back to the FX bureau at a small profit afterwards. Money just to have for trips into the North. I would leave the serious business of FX trading to those who have millions to churn around on a daily basis. And I will ignore scare stories about the collapse of the Euro. We had loads of them back in 2011, when our Central Bank was supposed to be preparing to print New Punts.


  • Registered Users Posts: 143 ✭✭ Baseball72


    Could I ask a separate but related question.

    I have just under £2K in a UK pension which I was in briefly in the late '70's when I worked for an NI company.

    Should I draw it down and lodge into my bank here in Dublin, or draw it down into my bank in Dublin but into a newly created Sterling account - for my trips over to England for football matches (3-4 a year generally) / buying on line from a UK based shop?

    Its not a lot of money to be worrying over but just thought I would seek some advise on the matter. I also travel north - before the lock down I was in NI three times on business - I'm still working (65) - hope to resume business trips to NI every second month or so......


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  • Registered Users Posts: 2,419 ✭✭✭ antix80


    Hardly seems worth the fees or hassle of operating a sterling account in a highstreet bank.

    Open a revolut account with a sterling balance, draw it to that and tip away at it.


  • Registered Users Posts: 143 ✭✭ Baseball72


    antix80 wrote: »
    Hardly seems worth the fees or hassle of operating a sterling account in a highstreet bank.

    Open a revolut account with a sterling balance, draw it to that and tip away at it.

    Thank you, that sounds a good option.


  • Registered Users Posts: 3,337 ✭✭✭ dubrov


    Baseball72 wrote:
    Should I draw it down and lodge into my bank here in Dublin, or draw it down into my bank in Dublin but into a newly created Sterling account - for my trips over to England for football matches (3-4 a year generally) / buying on line from a UK based shop?

    Just open a Revolut account. You can transfer it there and use it on your trips to the UK. The other option is to convert it to Euro there if you like and then transfer it to your own bank account.


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