GBP/EUR rates are creeping back up towards 1.30, following poor Eurozone Manufacturing & Services data released this morning. With the official reading coming out under expectation, the markets have reacted accordingly and the EUR has lost value as a result. This has continued the trend set last week, with Sterling gaining value due to the most recent referendum poll, which indicated the Remain camp had a clear lead. We also had poor Eurozone inflation data and this conspired to push GBP/EUR back above 1.30, although the Pound could still not find enough support to hold its position above that threshold.
Despite Sterling’s recent improvement there are still varying media reports arguing both for and against leaving the EU. These are likely to cause further uncertainty in the markets and this is unlikely support any major improvement for the Pound form the current positions. If we see a sustainable increase above 1.30 then the Pound may well find support around that level but under current conditions I still feel it may struggle to do this.
It’s a fairly sparse week in terms of economic data for both the UK and the Eurozone, so it’s likely Thursday’s UK Gross Domestic Product (GDP) will be of most interest to investors. It was the previous GDP release which boosted Sterling’s value, so it will be interesting to note whether this positivity is backed up by Thursdays official figure.
If you have an upcoming GBP or EUR currency requirement and would like to discuss the current market conditions and forecasts, or simply wish to compare our award winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478 and ask one of my team for Matt. Alternatively, I can be emailed directly on [email protected]