Lock in Your Exchange Rate: Expert Information on Currency Fluctuations

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As you consider your overseas property purchase, it is important to stay informed about current market trends. Here, we explore why using a currency exchange provider is an important step in your property purchase journey, with valuable insights regarding the potential devaluation of the US dollar from our currency exchange partner, Lumon.

Why Locking in Your Currency Exchange Rate Matters

Locking in your currency exchange rate can be a real game changer for property buyers. Here are some key reasons to consider:

• Avoid Uncertainty: Currency exchange rates can fluctuate significantly, potentially increasing the cost of the property. Locking the rate ensures that buyers know the exact amount they will pay, thereby avoiding surprises.

• Budgeting Accuracy: Fixed rates allow buyers to set and stick to a budget without worrying about rate movements impacting on their overall costs.

• Mitigate Financial Risk: When the buyer’s currency weakens against the foreign currency, the cost for the buyer increases. Locking the rate minimizes this risk.

• Streamlined Transactions: It simplifies the financial process as it is no longer necessary to track exchange rates daily.

How to Potentially Save Thousands when Buying or Selling a Home

According to Jonathan Watson, Senior Executive Dealer at Lumon, “Lumon surveys over 50 different banks to get their latest FX forecast and research data. This indicates a deteriorating value of the US dollar, because of interest rate cuts and the impending election. Of course, there are never any guarantees in the FX markets, and these forecasts change each month.”

Lumon’s research on the history of EUR/USD exchange rates shows up to 4.8% average market movement one month either side of the US election, over the last three US elections, since 2012*.

Using this example, a 100,000 EUR transfer could cost a difference of $5,200 within one month either side of the US election. Selling a property in the US for $500,000? This would become a variation of €21,900 in your Euro budget, just due to currency exchange fluctuations

This highlights the necessity for Lumon to advise any US clients buying and selling in Europe, to help protect and manage their international budget during this potentially volatile period.

Secure Your Exchange Rate with Lumon

To mitigate the potential impact of currency fluctuations on your purchase, speak to Lumon today. Lumon offer multiple solutions to fix and lock in rates in advance of a purchase, helping you to target your desired exchange rate, providing you with financial certainty.

*This is not a guarantee of future outcomes, but an analysis of the past. Lumon can provide personalized advice depending on your situation.