The GBP to EUR interbank exchange rate reached a high this morning of 1.1208 despite market concerns over a prolonged battle against Covid-19.
The global number of Covid-19 cases has exceeded 700,000 and it will not be long until the million mark is surpassed. Governments around the world continue to see what measures they will need to take to stimulate their own domestic economies against the economic damage caused by the virus.
Heated Discussion Between EU-27 Leaders
There was a heated debate by the EU-27 leaders last week, on how to tackle the Coronavirus. Countries including Spain, Italy and France were more in favour of issuing EU-backed debt now dubbed “Coronabonds”. However, the debt burden being shared amongst all EU countries was rejected by several member states including Austria, Germany and the Netherlands. Instead they favoured means including the European Stability Mechanism. EU finance ministers are expected to hold a conference this week to find a solution for the European Union.
Data Releases, GBP to Eur Forecast Lower?
March inflation figures (Consumer price index) from Spain were published at 0.1% against a forecast 0.5%. German inflation figures are released this afternoon at 1pm and are currently forecast to come in at 0.1% against a previous reading of 0.4%. There may be little response from the market on these data released, as the main focus remains on the economic fallout from measures aimed at containing the spread of the virus.
While Prime Minister Boris Johnson recovers from the Coronavirus, we will look forward to the week where we might see further indication of stricter controls on the movement of people in an effort to contain the virus. This week we have seen the number of confirmed cases increase to nearly 20,00 in the UK, which is a sharp rise from the early readings last week in part due to an increase in the number of people being tested.
With all the market uncertainty and volatility, if you are in the process over the next 12 months looking to buy or sell the euro and do not have the funds available now, we can always secure your currency on a forward contract allowing you to secure an exchange rate today for a future payment. This requires a 10% deposit with the balance being paid on a date of your choice up to one year ahead.
If you’d like to discuss these factors and how they could impact your currency exchange, you can reach me directly using the form below.