Transferring Funds Internationally

Predicting the Market

Nobody can accurately predict future exchange rates and consumers should be very wary of dealers who claim they can. Most clients will be better served making sure they are getting competitive rates and understanding the options they have to minimise the impact of adverse exchange rate movements on their funds transfer.

Having said that it is nice to follow the markets and understand what is causing trends and volatility in exchange rates. The factors that generally have significant impact on exchange rates are:

• The release of economic data such as GDP, inflation and unemployment
  
  
• Changes to a country's fiscal policy
  
  
• Large capital flows as fund managers move assets between global markets
  
  
• Changes to interest rate differentials between counties
  
  
• The trends in other asset classes such as commodities, equities and bonds
  
  
• Geo political events that increase or decrease a country's risk in the eyes of investors

It is also useful to monitor currency charts to familiarise yourself with the history of an exchange rate and understand it's historical volatility.

In depth analysis of charts and price history is called technical analysis and is a popular approach to timing exchange rate transactions.

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