Sterling exchange rates have fallen nearly 1 cent today against the single currency as the market eagerly anticipates the Bank of England and European Central Bank interest rate decisions on Thursday. Following Mario Draghi’s act of defiance, in which he stated the ECB will do ‘whatever it takes’ to protect the Euro. Following this announcement the market is expecting some bold moves from the ECB on Thursday, something that may cause the Euro to gain support and strength against the pound. Does this mean it is the end of the strong buy levels for GBP/EUR? In my opinion there is a very good chance rates could fall away to 1.25 level and Thursday afternoon at 12:45 should be keenly watched by anyone with an interest in GBP/EUR exchange rates. Likewise keep an eye on the Bank of England interest rate decision at 12:00, I would expect rates to stay on hold at 0.5% however there is a small outside chance of a rate cut to 0.25%, something again that would put pressure on Sterling and lead to a loss in value. Should you be buying Euros, Thursday could well be a day to avoid.
To discuss my views or to activate a free no obligation trading account and benefit from our award winning exchange rates then please email Mike at [email protected] and I will happily run through my thoughts and opinion on this very volatile market.