GBP/EUR exchange rates have remained fairly stable over the course of the trading week, keeping within similar levels that we have seen in recent weeks.
Yesterday, European economic data failed to impress but that was still not enough to break the pairing out of this range and had very little impact on market levels.
Brexit appears to be holding back the Pound from making any major positive movements against any currency at the moment, the uncertainty that it brings is casting a grey cloud over the U.K and leading to investors and speculators steering clear of GBP.
Tomorrow in my opinion is the most important day of the week and may set the trend for where this rate pairing may head in the short term.
Many analysts believe we may now see an interest rate hike from the Bank of England tomorrow, however this does not necessarily mean that the Pound will gain value solely based on the hike. The tone of the speech afterwards and the content of the meeting minutes may be the key drivers for Sterling exchange rates on the day.
An interest rate hike is generally seen as positive for the currency concerned as it makes it more attractive to investors, but we also need to remember that the markets will also move on speculation as well as fact, so should we see a hike then we may see a little rise in the value of the Pound but investors will almost immediately be looking at when we can expect another one. Should Mark Carney advise the markets that he is extremely concerned about Brexit and what will happen in the coming months then the Pound may actually end the day lower, even with a rate rise!
The other possibility to factor in is that the BOE do not make their move just yet, this could put the Pound down straight away and may make a purchase of foreign currency much more expensive.
Either way, Thursday is set to be a key day for anyone that has a large purchase of foreign currency to make, or for anyone that needs to bring money back into Sterling in the near future.
If you are in this position and you would like assistance with a Pound to Euro exchange, or would just like to be kept up to date with any spikes in the market tomorrow then you are more than welcome to contact me personally. Feel free to email me with a brief description of your requirements on email@example.com and I will be happy to get in touch with you.