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It seems UK businesses still hedging their bets above 1.2000 GBP/EUR

As mentioned here several times before, many UK businesses choose to look (and hedge their FX commitments) at the EUR/GBP as a reciprocal rate and that is the price of the GBP/EUR. Well, on Friday that rose to a new 2024 high, at 1.2055. That equated to a EUR/GBP rate of 0.8295 (also a new 2024 low of course). Well, not for the first time this year it seems levels well in excess of that 1.20 handle delivered further Sterling outflow. You see the UK still has a huge, almost £100 billion trade imbalance with Europe, as we import far more from the region than we export. So, when the Euro weakens, many of these companies take advantage of the rate, to hedge their future FX liability. So, it seems that was the case on Friday as the GBP/EUR pushed above 1.20 again. That seems to be the level at which many UK companies are still happy to hedge their costs. So, the EUR/GBP closed on Friday at 0.8327. The range seen so far today has been set at 0.8321 to 0.8334. It is currently trading at 0.8327, right where it closed on Friday 
 

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