GBP/EUR nosedives again as Mark Carney says an interest rate hike is now likely (Joseph Wright)

GBP EUR Looks to Employment Figures for Support

After being in recovery mode for a coupe of days Sterling exchange rates have weakened once again, selling off as soon as the Bank of England governor Mark Carney said that an interest rate cut is likely in order to cushion the blow to the UK economy now that the UK has left the European Union in the so-called ‘Brexit’.

Interest rates are currently at a record low in the UK at 0.5%, and interest rate cuts usually have a negative effect on the economy in question therefore it’s understandable that markets would react like this, making it an even further favourable time to convert Euros into Pounds.

Moving forward I expect the Pound to be under increasing pressure as before this afternoons statement from Mark Carney 1.20 was acting as a support level but that was soon broken shortly after the first reference to further economic stimulus.

Those with a need to convert Sterling into Euro’s may wish to look at making that move sooner as opposed to later after this afternoons developments made it clear that the transition isn’t going to be plain sailing.

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