Sterling made gains against the Euro during yesterdays trading session after members of the Bank of England (BoE) indicated they are now sitting on the fence whether to vote yes or no for an interest rate hike. With interest rates being the single most important driver of a currency, if the BoE raised the interest rate this would give strength for sterling (more €s for the £). However an interest rate hike is not on the cards until 2016 therefore I believe Euro buyers should take advantage of the recent comments and therefore the current levels we are seeing.
What will affect GBP/EUR over the next month?
The two main drivers that will effect GBP/ EUR exchange rates within the next month are the UK General Election (Weakening Sterling) and a possible ‘Grexit’ (Weakening the Euro). Over the last month the ‘Grexit’ has been outweighing the UK Election, however as of Monday I believe the tides will turn. In the lead up to the last election, GBP/ EUR dropped by over 3 cents and I don’t think this election will be any different. Therefore my prediction is GBP/EUR will be around the 1.36 mark come the 7th of May.
Depending on the outcome of the election will depend on what happens to GBP/ EUR exchange rate. Please click here for a full report on the possible election outcomes. If you are looking to buy or sell Euros within the upcoming months feel free to get in touch by emailing me on firstname.lastname@example.org or alternatively call 01494 787 478 and quote Dayle Littlejohn.