The current GBP/EUR interbank rate is 1.1573. There are a number of factors that could affect GBP/EUR rates in November. For instance, it’s forecast that the UK’s services vast sector shrank again last month, ahead of key data released this week. In addition, there’s the Bank of England’s (BoE) latest interest rate decision, due this Thursday, in which it’s thought that the BoE may cut its UK economic growth forecasts for 2019/20.
Meanwhile, turning to the Eurozone, the common currency could be influenced in November by this Thursday’s retail sales data, as well as the European Commission’s updated GDP (Gross Domestic Product) growth predictions. Lastly, the GBP/EUR rates may also be affected by the UK’s ongoing opinion polls, ahead of the December 12th election.
UK’s services sector forecast to shrink again in October
The UK’s vast services sector is forecast to have declined again last month, ahead of IHS Markit’s crucial PMI (Purchasing Managers’ Index) this Tuesday. In particular, it’s thought that UK services activity in October hit 49.7, which would be marginally above September’s 49.5, yet still below the 50.0 figure that separates economic growth from contraction. So, this could potentially affect the pound.
Bank of England forecast to hold interest rates, may cut growth forecasts
This Thursday, the Bank of England looks set to keep UK interest rates steady, at 0.75%. However, it’s believed that the BoE could cut its UK GDP forecasts for this year and next, both because of the ongoing Brexit uncertainty, and the global trade war. This may influence the value of sterling, because lower BoE UK GDP growth forecasts are traditionally considered a sign of economic weakness.
Eurozone retail sales, growth forecasts could impact Euro
The euro’s value could be affected in November, both by this Wednesday’s retail sales figures for September, as well as the European Commission’s updated GDP estimates for 2019/20 on Thursday. The Eurozone surprisingly expanded by 0.2% in Q3, so if these upbeat data are reflected in this week’s growth estimates, it may influence the euro.
UK polls ahead of December 12th election may affect Pound
Pound to Euro exchange rates are most likely to be affected in November by the opinion polls, ahead of the UK’s general election on December 12th. According to Opinium’s latest survey, the Conservatives stand at 42%, ahead of Labour’s 26%. This may enable Prime Minister Boris Johnson to gain a Parliamentary majority, and at long last approve his Brexit deal. According to Reuters UK today, sterling is being held back by the election uncertainty.
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