a strong £

28 Jul

Digital StillCamera

london 2014 monday

The uk has finally come out of the longest depression. this one started in 2008, and it is now 6yrs later .

i have a feeling a lot of that is due to the £ going down. nothing encourages more exports and less imports than a falling £ and that is good for business and the country as a whole.

for me, i can remember a time when the £ = 6.5Rm(ringgits) even hitting 7Rm, compared to now = 5.4 Rm. and of course that wonderful time when we can get 1.5Euros for £1. now it is 1.26Euros. at one time not that long ago, it used to be even less. 

If the £ is low, because it costs more to import stuff , it seems; cost of living goes up for those of us living here but that seems to be the price all of us here have to pay to shore up the economy.

in a way, because VAT is zero for veg and meat, if u keep to those, like i do,  u wont be much affected and side stream yourself from having to pay the increased cost of living.

Those who are clever can structure what they buy and change their lifestyle and not pay anything like the prevalent cost of living.  And if u keep to basics range you would hardly notice the rise in the cost of living.  Certainly for me, i don’t notice it. 

i have to add a correction. actually my monthly outgoing for food has doubled, from £20 a month, it is from such a low base that i dont notice it even if it is doubled now. so i guess perception is a very subjective thing. haha. in the past the supermarkets discount their meat a lot at the end of the day and there are plenty of them, so easy to get;  but now , there are less of those bargains, in fact i would say there are none now. that accounts for why my food bill has doubled. 

Now i read the news that the £ has gone up and many companies mention that as their reason for profit warnings ahead. It seems the £ has risen on the anticipation of a interest rate rise. The bank of england governor have been hinting at it but not doing it for real. almost as if the bank of england wants a higher £ but without having to actually raise the rate. clever strategy, and seems to be working… for now. it is a way of dampening the rate of growth, without actually raising interest rates which will dampen business activity in the country. 

If you think that the strong £ will mean you get better exchange rate for your tourist money, think again. it seldom happens that you get a stronger exchange rate, as soon as the £ strengthens, though rates drop immediately everytime the £ weakens. if u search, u will find £1 = US$1.70. £1=1.26 euros;  but will you get that rate in the money changers on the high street? i bet u wont. i shall have a look at their rates when i go out later, and see what rate they give.

added. 4pm. i am surprised the rates are quite good.  1.245 euros, and $1.68. only a spread of .02 . no commission. no wonder there was a long queue stretching outside the office and round the corner. it was the american express office in victoria st, near the westminster cathedral. 

added. i have noticed converting euros to £, or $ to £ is not so good. so as usual if u are a tourist wanting to convert to £s, you lose out. i think tourists are like the wildebeest in africa, being the prey of all the predators lying along its path as they migrate across the plains. the only thing is the wildebeests have to do it, to follow the rains, but you dont have to be a tourist. 

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