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British pound falls again and heads for parity against euro
Photo: AFP

British pound falls again and heads for parity against euro

The Local · 6 Jul 2016, 10:18

Published: 06 Jul 2016 10:18 GMT+02:00

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At the time of writing, the British pound is worth €1.17, down from around €1.40 before the June 23rd referendum that saw the majority of British voters opt to leave the EU.
This comes as a knock-on effect from the pound falling against the US dollar overnight, seeing lows that haven't been reached since 1985. 
"The pound sterling recorded a bad performance after poor economic figures from the UK, including a stronger slowdown in services," Eric Viloria of Wells Fargo told the AFP news agency. 
This drop has seen the value of the euro drop slightly against the dollar too, with one euro currently worth 1.1050 dollars.

Some analysts have suggested that the pound and the euro will eventually reach parity.
David Meier, an economist at Julius Baer, said he would "not be surprised" to see parity within the next 12 months. 
"We believe that weakness will extend gradually beyond the first shock reaction, as the fundamental data will continuously turn pound-negative," he wrote in a research note soon after the referendum.
The past week of Euro per 1 GBP. Photo: XE.com
Impacts of a weaker pound for France
As the value of the pound continues to tumble, many Brits will see their summer holiday budgets rise considerably.
Brits make some 12 million visits to France every year, most of which are made in the summer. While companies like Brittany Ferries say they haven't noticed hordes of British travellers looking to cancel, it fears the fall in currency may impact future bookings unless the value of the pound picks up.
Many expats in France earn a living from the tourist industry, and its no secret that the British (and their wallets) play a large part in contributing to this industry. 
Those working in operating tours or renting out property - popular jobs among Brits in France - are likely to see continued strains on their business if the pound keeps dropping. 
The falling pound also spells bad news for any retirees living in France who depend on their UK pensions or investments for income.

And any Brits in the UK who have been planning to escape to France and buy a dream home in the country may have to rethink their plans, as finance experts told The Local soon after the Leave vote came through. 
George White, who was planning to sell up in the UK and buy a house in France says he has been left in limbo.
"We were planning to move to an "equal valued" house [in France] which would in theory have been a nice big place will land and a swimming pool.. Now we are in limbo. We do not feel good about this," White told The Local.
"We are devastated. We will lose financially."
Estate agents in France fear that a falling pound will badly hit the foreign housing market, to which British buyers contribute massively in certain parts of the country like Dordogne.
Of course, the currency uncertainty brings good news as well, with those in France keen to visit the UK  never having a better excuse to cross the channel and enjoy a cheap holiday. 
And of course for those selling their house in France to return to the UK , there may be no better time.
David Thompson is one of those selling up and heading back to the UK.
Story continues below…
"It makes sense to move back and sell the French property. Unfortunately we bought it at the peak of property prices and they have slumped since, so we aren't even getting back the amount we spent to buy it, so the more pounds sterling we can get from the sale the better," he told The Local.
However looking on the positive side, it was only a few years ago that the pound and the euro were almost level and life went on pretty much as normal.
And after all, the Brexit isn't all bad news for Brits in France. In fact, we've come up with a whole host of things that show there is a bright side to the Brexit vote. 
If you have been affected by the fall of the pound, either positively or negatively, please get in touch and tell us your story. Email ben.mcpartland@thelocal.com
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