Uncertain period ahead for the Pound Euro exchange rate
The Pound Euro exchange rate has been drifting slowly lower during the course of the week so far as more pressure gets piled on the British economy.
With many strikes having taken place already and with further strikes scheduled over the next few weeks the UK remains in a very uncertain period.
Teachers, nurses, rail strikes to name but a few have all caused the government to make some difficult decisions in order to appease those sectors involved in industrial action.
However, so far none have come to a full resolution so we could see further strikes ahead.
UK Inflation out of control
UK inflation remains above 10% and although we have seen two consecutive drops in the last two months the figure is still far too high compared to the target of just 2%.
The Bank of England are due to meet once again in February and there is a strong likelihood of another interest rate hike due to come.
In past history an interest rate hike would often lead to that particular currency strengthening against others.
However, as the UK economy is in such a difficult state trying to balance excessively high inflation combined with a struggling economy we may not see the Pound improving even after an interest rate hike.
Indeed, with so many interest rate increases during 2022 the latter part of the year saw the Pound often fall even after the rate hike.
This was mainly due to the rhetoric provided by the Bank of England including Andrew Bailey who claimed that the UK was in line for its worst recession in history.
Eurozone Data to impact GBPEUR rates early next week
We could see a lot of movement for Sterling Euro exchange rates on Tuesday as the Eurozone publishes a lot of economic data on the last day of January.
Germany will release its latest unemployment figures and this will be followed a little later by Eurozone GDP figures due out at 10am for the final quarter of last year.
This will provide an insight into the strength of the Eurozone economy so if you have a currency transfer to make involving Sterling and Euro then pay close attention to Tuesday morning’s announcements.
If you would like a free quote when transferring Pounds or Euros then contact me directly.
I have worked in the industry for 19 years and I’m confident that I can help you compared to using your bank for the exchange.
Email me with a brief outline of your requirement and I look forward to hearing from you.
Tom Holian [email protected]
