Pound to euro interbank exchange rates endured a fairly uneventful week, remaining in the high to low range of 2020 between 1.1706 and 1.1823. Sterling did initially find some support earlier last week following better than expected data for the Services sector, with a reading of 50 coming in, representing the minimum requirement of expansion in the sector.
On the important matter of Brexit there was perhaps less optimism, with Ursula von der Leyen, the new European Commission President, seeking of positive engagement, undermined by her referral to it being ‘basically impossible’ to fulfil a fully ratified deal by the end of the year.
The pound to euro exchange rate has been buoyed by the slightly more impressive economic data but ultimately the Brexit news appeared to override any economic developments.
On the euro side, investors were closely monitoring the latest political news from Spain, where Spanish caretaker Prime Minister Pedro Sanchez won a confidence ruling to allow him to form a coalition with the far-left Podemos party.
Political uncertainty can be a factor to weaken the currency concerned but with British political issues appearing more of a concern, GBP/EUR was not too affected. This might be an issue to be conscious of in the future, to influence the relative strength of the euro.
What Will Move GBP/EUR Rates Next Week?
Looking to the week ahead, investors receive important economic news regarding UK GDP (Gross Domestic Product) data which could be a market mover. The strength of the UK economy has been in close focus since the Brexit vote, as the market seeks to understand the impact on Brexit.
Given Mark Carney has hinted that more economic stimulus might be necessary in the future, the outcome of the data has the potential to be influential.
For the euro, investors will wish to be up to date with the latest Inflation data, since future economic policy from the ECB (European Central Bank) will also take cues from how the European economy performs.
If you would like to learn more about factors influencing GBP/EUR exchange rates for an upcoming currency transfer, feel free to contact myself, Jonathan Watson, using the form below.