Impact of leadership election on pound vs the euro
The pound has managed to stabilise against the euro over the last few days. After hitting close to a 5 month low the pound has found support recently against the euro. This could be put down to the current leadership election.
At this point it appears as though Boris Johnson will win the campaign to become the next Prime Minister. He managed to win the first round convincingly and unless some news comes out which is negative I think we will only have one winner. This has helped the pound to make some gains vs the euro as it has provided the markets with a little more certainty. However, although he is likely to win the contest it is still not clear what will happen with Brexit. Boris has claimed that the UK must leave the European Union by the end of October.
Personally, I cannot see this happening as he will also need to convince the House of Commons. Since December when the voting on the Withdrawal Bill started they have been adamant that the current deal on offer will not be approved. The European Union have also dug in their heels since the end of March claiming that the deal on offer will not be renegotiated. This leaves us in a state of limbo which is why the Pound has been struggling to make any real gains since the end of March.
Economic data to impact pound vs euro rate
Although the market will remain focused on the leadership election there are a number of different economic data releases due out this week. Eurozone inflation data is due out in the morning and this will provide evidence to the European Central Bank as to what to do in terms of monetary policy. Therefore, if you plan to make a transfer involving euros then pay close attention to the figures.
On Wednesday morning the UK releases its own inflation data for May. The expectation is for 2% so any change could move GBP/EUR exchange rates. If you’re in the process of buying a property abroad and would like to fix your exchange rate then contact me for more information about a forward contract.
If you would like to save money when buying Euros then contact me directly for a free quote and I look forward to hearing from you.