GBP and election
How might the GBP/EUR rate affect UK property purchasers in Spain?.
If you are purchasing property in Spain and looking to convert your hard-earned GBP into Euros, you will no doubt be keeping a watchful eye on current politics and how the resultant exchange rate fluctuations are likely to affect your purchase.
UK politics has indeed been keeping GBP investors on their toes. Over the past year, British purchasers’ spending power has decreased so dramatically that their Euros are simply not stretching to former levels.
However, during the last week of November, the GBP/EUR exchange rate briefly touched a new six-month high, just as a crucial YouGov’s MRP poll indicated that the Conservatives were on track to win the UK General Election with a majority of 68 seats. The Conservative win at the General Election on 12 December 2019 may well indicate improved spending power for UK property purchasers in Spain.UK politics remains in the spotlight
British politics will continue to be the main catalyst when it comes to Pound to Euro exchange rate fluctuations, and GBP investors will be keeping a close eye on the potential volatility for the Pound Sterling, particularly now that Brexit is back on track.
Meanwhile, the Tory victory is likely to enable the Pound to regain some of its strength against the Euro, a positive following a minor slump recently due to a bleak outlook from experts regarding the UK’s manufacturing industry.
But what if Labour had won?
This would have entailed a radical overhaul of the economy and a sharper decline in the Pound. The markets feared Labour’s plans to nationalise large swathes of the economy. Traders would expect that such a lack of faith could also lead to a slump in the share prices of nationalised companies, hitting savers’ and workers’ pensions alike, so from an economic point of view the Tory victory means an improvement, at least in the short term, as the final stages of Brexit are negotiated.
For British buyers of Spanish property, it signals the likelihood of a stronger pound and better spending power in the months to come.