Forecasts for the Euro against the US dollar (EUR USD) varies across different banks and over time. This article takes a look at the trend in EUR USD forecasts and other key EUR cross currency rates.
The Forecast for the Euro in 2018
The EUR USD exchange rate has gradually moved up from very low levels to around 1.1950 currently. At the start of last year, €1.00 Euro only bought you just over $1.00 US dollar. In 2018, most bank analysts predict the EUR USD to continue to rise towards 1.2500-1.3000 by the end of the year, but not without hiccups.
Transferring Money Overseas
If you’re looking to transfer money overseas, it really depends on the destination you’re moving your money to. Usually, a rising Euro exchange rate means it will be cheaper to transfer money overseas, while a falling Euro means it will be more expensive.
Check out the forecasts below for exchange rates predictions for 3 key cross rates in 2018.
How to Find the Cheapest Way to Transfer Money Overseas
Compare The Total Cost
The total cost of the transfer comes down to 2 things:
1. Transfer Fees
Every Australian bank and money transfer company will charge you a different fee to send money overseas. Usually it’s between $10 and $32.
2. Exchange Rate Margin
There is no “standard” exchange rate. Each bank will offer you a different exchange rate based on the currency you want to send overseas and the amount you need to send.
How does a rising Euro affect me?
A rising Euro is great for citizens of the 19 countries in the Eurozone who are lucky enough to move or travel overseas or who are already living abroad.
If you are an expat or pensioner supporting your lifestyle abroad using a Euro bank account, you will be able to transfer money overseas at better rates next year if the bank analysts forecasts are accurate. It means you have greater buying power, because you can purchase more Pounds Sterling while you’re in the UK, or Aussie dollars if you’re in Australia, for example.
If you’re planning to travel abroad for a holiday next year, a stronger Euro will certainly help you, particularly if you choose a destination with a weaker currency. A trip to the UK, perhaps?
If you want to maximise your spending power while you’re overseas, we recommend checking out our currency calculator for the best rates for various money transfer or travel money options.
What are the top 3 influences on the Euro?
1. Eurozone Economies
Growth in the 19 Eurozone countries has been surprisingly strong this year, led by Germany and France. This is supporting the Euro. Most bank analysts expect the Eurozone economies to continue to improve in 2018.
2. Eurozone Politics
Many are still unsure whether integrating the economies of 19 countries into one bundle (the Eurozone) will work. If one country has political issues, it can create uncertainty for the whole Eurozone. Greater uncertainty from politics means investors will sell the Euro, because there is a greater chance of it getting weaker.
3. Other Currencies
The US dollar (USD) has a significant influence on the Euro. Generally, when the USD gets stronger, the Euro is relatively weaker and vice versa. With the USD looking to rise in coming months, it might hinder a stronger Euro performance.
General advice: The information on this site is of a general nature only. It does not take your specific needs or circumstances into consideration. You should look at your own personal situation and requirements before making any financial decisions.
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