Why is the Pound dropping against the Euro?
Pound Euro close to 4 month lows
The Pound Euro exchange rate is now close to its lowest level since September of last year.
The Pound has been experiencing a difficult period vs the Euro for weeks since the start of December.
The sudden turn of fortune for Sterling could be attributed to what happened in early December.
The Bank of England hiked interest rates once again but the European Central Bank countered that by also hiking interest rates for the first time in months.
This could be taken...
What will 2023 Bring For Sterling Exchange Rates?
Sterling exchange rates have dropped on the whole throughout 2022 and it is fair to say there are a number of quite obvious reasons behind the poor performance of the pound over the course of the year.
Here is a summary of GBP paired against a selection of major currencies and the movement since 1st Jan 2022 as an example.
GBP/USD -10.79%
GBP/EUR -4.97%
GBP/CAD -5.44%
GBP/AUD -4.69%
GBP/CHF -9.97%
All in all, the above suggests the pound indeed had a torrid time of it, most notably shortly after Liz Truss...
GBP exchange rates climb despite warnings regarding the UK economy
The Pound begun the week in a volatile fashion yesterday, and traded in over a 1-cent range against the Euro after testing the 1.1650 handle once again.
We have now seen the GBP/EUR exchange rate test trading levels around 1.1650 at least 4-times in the last 3 months with yesterday being the latest example of this pattern. Yesterday morning during the earlier hours of trading GBP rebounded from the 1.1650 once again demonstrating that there is resistance at this level, so if you’re planning on...
Liz Truss Resigns and the Pound falls in value against the Euro and US...
Liz Truss Stands Down
After what has been the shortest reign in history for a British Prime Minister, Liz Truss finally resigned yesterday afternoon.
The Pound Sterling exchange rate remained relatively stable during yesterday’s trading session as its likely the market had priced in the decision for Liz Truss to step down.
However, as of Friday morning the Pound had really felt the impact of the uncertainty as to who could come and take the leadership in her place.
Boris Johnson has been touted now as one of...
Will Liz Truss lead the Tories into the next election and how will this...
Despite being appointed as Prime Minister just over a month ago on the 6th of September 2022, Liz Truss is already coming under pressure and there is speculation regarding her remaining in power already.
The Pound has traded in a more speculative fashion over the past month than it has done for years after a disastrous mini budget which sent shockwaves throughout financial markets, and saw the Pound trade against the lowest level against the US Dollar in recent history.
Truss appointed Kwasi Kwarteng as Chancellor...
Will the government perform a U-Turn? Impact on GBPEUR & GBPUSD Rates
Will a u-turn be coming for the current government?
Three weeks ago the Chancellor Kwasi Kwarteng announced his mini-budget. This caused a huge sell off for Sterling exchange rates.
It also caused an issue for bonds and UK mortgages.
However, since then the Pound Euro and Pound US Dollar has also improved.
Indeed, Sterling Euro rates are currently close to a 2 month high creating some excellent opportunities to buy Euros with Pounds.
The Bank of England recently stepped in and spent a huge amount of money to...
Pound hits record low against the US Dollar, and drops significantly against the Euro
Yesterday was a very difficult day for the Pound as financial markets appear to have lost faith in both the Bank of England’s monetary policy and the new cabinet’s mini budget.
Last Thursday the new Chancellor of the Exchequer, Kwasi Kwarteng announced his mini-budget outlining plans for a raft of tax cuts. Then over the past weekend he pledged further tax cuts in order to try and reinvigorate the UK’s stalling economy and attempt to counter the increasing inflation rates not seen in decades.
His plans...
Bank of England and mini budget – The impact on Sterling exchange rates
The Bank of England increased interest rates for the 7th time in a row by 0.5% to take the base rate up to 2.25%, which was the biggest single rate hike in years. This caused the Pound to fall briefly against both the Euro and US Dollar as there were some predictions that the Bank of England may have raised rates by as much as 0.75%. As this didn’t happen the Pound plunged almost immediately after the announcement but managed to reverse some of...
Three Key Events in a Vital 72 hours for GBPEUR and GBPUSD Exchange Rates
The beginning of this week in the UK was very sombre with Her Majesty’s funeral and a UK Bank Holiday. This meant UK markets were shut, and ensured a fairly sleepy start to the week from a currency perspective, with sterling still nestling in the doldrums following the poor Retail Sales data from last week.
The rest of this week looks far from calm however, with three key events that could trigger market movements for the pound, US dollar, Euro and many other currencies. The...
Pound Sterling Forecast – The Week Ahead for Sterling Exchange Rates
First and foremost it has been a tough start to the week in terms of economic data, which has led to a drop-off against most majors.
Growth figures for the month came out at 0.2% instead of the predicted 0.5%, Industrial and Manufacturing production figures also missed the mark, which again just adds more fuel to the fire that a long and challenging recession is fast approaching for the U.K.
Our condolences to the Royal family after the terrible news that Her Majesty had passed on...
