Over the last 3 months the pound (GBP) has fallen around 11% against the US dollar (USD) and at the moment the trend looks like continuing downwards. Sterling today fell to a 10-month low against the dollar with many analysts now predicting a continuation of the fall to $1.4.  The fall seems to be driven by a number of key factors including:

• Currency speculators have built up over $6bn of short positions against sterling (effectively betting that it will fall).
• There are doubts about the Bank of England’s Bank of England’s plans in relation to quantitative easing in the UK.
• Opinion polls over the week-end seemed to indicate that Labour could hold onto power in the forthcoming general elections – the market is concerned that labour will not deal with effectively with the UK’s record fiscal deficit.
• The Prudential’s purchase of AIG’s Asia business will put further pressure on the pound because $25bn of the transaction will be in cash and in dollars.

If the pound does fall to $1.4 then this will represent a 17% fall in a relatively short space of time. This has a significant impact on the cost of imported goods into the UK and has a direct bearing on the costs of branded flash drives and custom USB memory sticks.

Pretty much every USB memory stick in the world in manufactured in China and suppliers of memory sticks pay the factories in China in US dollars. Consequently, the fall in the value of the pound has a direct impact on the cost of USB flash drives. Couple these currency cost increases with the recent 2.5% increase in VAT its easy to see why costs risen over the past couple of months and look set to increase moving forward.

Some suppliers will have protected themselves to some degree against these fluctuations but this is only likely to be short-lived. If you are looking to buy branded memory sticks now then be prepared for quotes to be valid for just a day or two (the suppliers need to protect themselves against the vagaries of the market) and be prepared to make decisions quickly to secure the best price you can.

Tags: Branded Memory Sticks, USB Flash Drives, USB Memory Stick

This entry was posted on Monday, March 1st, 2010 at 4:01 pm and is filed under Branded Memory Sticks, Custom USB, USB Flash Drives, USB Memory Stick. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.