Daily Brief – Profit Repatriation

Profit Repatriation

For UK companies with overseas earnings reporting in Sterling, 2025 has been a salutary tale of a strengthening British Pound with periods of volatility prompted primarily by geo and domestic politics and POTUS. GBP/USD has seen a range of 1.22 to 1.37 and GBP/EUR 1.13 to 1.22. Finance managers at such companies are now scrambling to complete their 2026 budgets and as part of that exercise hedging those overseas earnings has moved towards the very top of the agenda. It is no coincidence that at SGM-FX we are seeing much increased demand for FX hedges for 2026 as our corporates secure favourable exchange rates in a weakening USD market environment.

GBP/USD 1.3424.

Lugano

If you would like to try out a city where you can use Bitcoin for most transactions without having to fly to El Salvador and all that that involves, proceed to Lugano, Switzerland. 350 shops and cafes have installed what look like credit card machines but are BTC terminals. For example, a coffee might cost 0.00008629 or USD8.80 or GBP 6.60 which sounds a lot but hey it will taste different because it has been paid for in BTC. Users claim it gives them “freedom” and avoids “middlemen and costs.” Quite how cash is less free or more expensive to a user is unclear. A Visa or Mastercard are also free subject to not incurring credit charges which are different. So, a real life experiment embraced con brio by crypto devotees in a Swiss lakeside city. A plus though for a holder of BTC and an advantage over crypto: that coffee once purchased is a real and tasty store of value and enjoyment – albeit briefly.

EUR/USD 1.1755.

MLC

We are now entering the most dangerous few weeks of the year for men of a certain age who in Darwinesque fashion feel impelled to embark on ventures that they would never normally contemplate. Collectively, those ventures come under the heading of Mid Life Crises and cover a broad spectrum ranging from red sports cars to adopting new interests for which they are patently unsuited. Nowhere is this more evident than in the sphere of men entering marathons despite all evidence that should preclude them from doing so. A helpful guide is available for the most beautiful and culture rich European marathons which include Paris, Rome, London, and Athens. Not to be undertaken in any circumstances unless medical sign off has been obtained is the Marathon du Mont Blanc which has the strapline of “between the sky and peaks.” Glaciers, snow-capped mountains, steep trails, forests and oxygen deprivation are all part of the Marathon du Mont Blanc challenge with the added bonus of a deep connection with nature. Beware.

EUR/GBP 0.8755.

UNESCO

The regular review by UNESCO of its list of intangible cultural heritage items has thrown up some interesting new items: Yodeling, a dip in an Icelandic pool and applying kohl to one’s eyes stand out. These will be added to the existing list which features: the Uzbek stringed instrument, the Kobyz; the oil wrestling festival in Edirne, Turkey, and Azerbaijani carpet weaving.

EUR/JPY 182.41.

Light My Fire

This day 55 years ago in 1970 the Doors gave a concert in New Orleans USA which unfortunately turned out to be lead singer Jim Morrison’s last performance with the band since he departed this world seven months later in Paris France where he remains to this day in Pere Lachaise Cemetery. An early advocate of the rock and roll lifestyle during which JM lived on a toxic cocktail of alcohol and amphetamines, his star burned bright until he flamed out at the far too young age of 28 leaving a musical legacy that could have been so much greater.

You know that it would be untrue
You know that I would be a liar
If I was to say to you
Girl, we couldn’t get much higher

Come on, baby, light my fire
Come on, baby, light my fire
Try to set the night on fire

The time to hesitate is through
No time to wallow in the mire
Try now, we can only lose
And our love become a funeral pyre

Come on, baby, light my fire
Come on, baby, light my fire
Try to set the night on fire, yeah

The time to hesitate is through
No time to wallow in the mire
Try now, we can only lose
And our love become a funeral pyre

Come on, baby, light my fire

Have a Great Weekend!

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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