The pound to euro exchange rate is trading around a 2-year low at the time of writing after dropping into the 1.06’s earlier this week. At the time of writing the pair sit at 1.0780 on the interbank exchange which is flat on the day, and it will be interesting moving forward to see whether the pair fall as low as the lows of 2009 when they almost hit parity.
Reuters publish probability of no deal Brexit: Sterling continues to show weakness against other major currencies
A poll carried on by Reuters earlier this month recorded that a no-deal Brexit has a 35% chance of taking place according to the economists polled in the survey. This is up from 30% in July and it’s this perceived increase in a no-deal taking place that’s resulted in the weakening pound. To add to this perception sterling exchange rates weren’t helped by the fact that during the 2nd quarter of this year the UK economy contracted by 0.2% which came as a surprise as the expectation was for 0% growth during this time as opposed to a fall in economic output.
UK wage growth figures: What could happen?
This morning wage growth figures will be released out of the UK with expectations of further improvements to be released. This could cause the Bank of England (BoE) to monitor inflationary pressures within the UK closely although as it stands the general expectation is for the BoE to keep interest rates on hold at the moment. With Brexit just around the corner and new Prime Minister Boris Johnson’s strong Brexit rhetoric I think the BoE will continue to sit on their hands for now to try and avoid any shocks to the economy.
Eurozone GDP released tomorrow
Perhaps the key economic release this week out of the Eurozone will take place tomorrow when Eurozone GDP is due for release, which expectations for 1.1% expected. If you would like to learn more or have an upcoming currency transfer and would like to save money when compared to using your high street bank, feel free to contact our team directly using the form below.