Pound Sterling to Euro (GBP/EUR) Exchange Rate Could Gain
Although Germany published comparatively positive employment and retail sales figures on Wednesday, the Pound Sterling to Euro (GBP/EUR) exchange rate was trending around the day’s opening levels as investors exerted caution prior to the publication of the Eurozone’s Consumer Price Index.
If the CPI figure for the 18-nation currency bloc comes in below forecast levels, the Pound Sterling to Euro (GBP/EUR) exchange rate could advance from its current level of 1.2751.
Earlier…
GBP/EUR Exchange Rate Falls as UK Growth Outlook Darkens
Although Greek concerns and ECB stimulus speculation continue to weigh on the Euro, the Pound Sterling to Euro (GBP/EUR) exchange rate fell by over 0.3% on Tuesday in reaction to a run of European economic reports.
While Italy’s final Services PMI for December was negatively revised (putting it back in contraction territory) the Services and Composite measures for Germany were positively adjusted, as were the figures for France.
However, the Eurozone’s Composite PMI was cut from an initial estimate of 51.7 to 51.4.
Markit economist Chris Williamson observed; ‘The Eurozone will look upon 2014 as a year in which recession was avoided by the narrowest of margins, but the weakness of the survey data suggests there’s no guarantee that a renewed downturn will not be seen in 2015. The weakness of the PMI in December will add to calls for more aggressive central-bank stimulus.’
As the European session progressed the GBP/EUR pairing came under pressure as a result of a very disappointing UK Services PMI.
The reading of 55.8 was far lower than the expected figure of 58.5 and triggered widespread Pound losses.
The Pound Sterling to Euro (GBP/EUR) exchange rate hit a low of 1.2738
Declines in the Pound Sterling to Euro (GBP/EUR) exchange rate were a little limited ahead of the publication of the Eurozone’s inflation report.
Given that Germany’s Consumer Price Index disappointed expectations yesterday, investors are betting that the Eurozone’s Consumer Price Index registered an annual figure of -0.1% or lower.
Earlier…
Although UK data disappointed and the Eurozone’s confidence report printed above expected levels, the Pound Sterling to Euro (GBP/EUR) exchange rate was left trending around the day’s opening levels as the European session drew to a close.
The UK’s soft construction print undermined demand for the Pound, but the Euro failed to benefit as Germany’s Consumer Price Index showed stagnation in monthly consumer price gains rather than the modest increase expected. The result ups the odds of the inflation report for the Eurozone as a whole showing the first annual decline in CPI for five years.
The Pound Sterling to Euro (GBP/EUR) exchange rate was trading in the region of 1.2774
Earlier…
GBP/EUR Exchange Rate Achieves 1.2816 Despite Construction Activity Slowing
The Pound Sterling to Euro (GBP/EUR) exchange rate pushed back above the 1.28 level as European trading continued.
Although Sterling lost ground against peers like the US Dollar after the UK’s Construction PMI showed a steeper than anticipated decline in December, the GBP/EUR exchange rate continued to benefit from ECB stimulus speculation.
The measure of the UK’s construction sector dropped from 59.4 in November to 57.6 in December, still well clear of the 50 mark separating growth from contraction but a much lower figure than the 59.0 expected.
Markit economist Tim Moore said of the data; ‘A sharp recovery in house building, as well as resurgent demand for commercial development projects, continued to boost staff recruitment and sub-contractor pay rates across the construction sector in December. While new business growth moderated to its lowest for a year-and-a-half in December, UK construction firms are still highly upbeat.’
Meanwhile, the Eurozone’s Sentix investor confidence index advanced from -2.5 to 0.9. A smaller improvement to -1.0 was anticipated.
Earlier…
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.2798 on Monday having pushed back above the 1.28 level early in the European session.
GBP/EUR Exchange Rate Benefits as ECB Rate Bets Weigh
The Pound Sterling to Euro (GBP/EUR) exchange rate advanced to a seven-year high last week as investors speculated on the outcome of the upcoming Greek election and European Central Bank (ECB) officials dropped hints regarding the potential introduction of quantitative easing.
While the GBP/EUR pairing later pared much of its advance in response to a soft UK manufacturing report, the Euro to US Dollar (EUR/USD) exchange rate extended declines to hit an almost nine-year low.
The downtrend in the common currency saw currency strategist Sean Callow comment; ‘The reasons to be selling the Euro were pretty clear over the weekend: Draghi being a step closer to QE and deepening concerns about the Greek political situation. The Euro was so close to such a keenly watched round number as 1.20 Dollars that we didn’t need any fresh news to tip us over the cliff.’
The Pound Sterling to Euro (GBP/EUR) exchange rate achieved a high of 1.2808
Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast
The Pound Sterling to Euro (GBP/EUR) exchange rate could experience volatility in the hours ahead as the Eurozone publishes investor confidence data.
The Sentix gauge of sentiment is believed to have improved in January, rising from -2.5 to -1.0. A positive reading could lend the Euro a little support, but movement is likely to be limited ahead of the publication of Germany’s Consumer Price Index at 13:00 GMT.
Consumer prices in the Eurozone’s largest economy are believed to have climbed by 0.2% on the month in December following stagnation in November.
The Pound Sterling to Euro (GBP/EUR) exchange rate fell to a low of 1.2782
Signs of an upswing in inflation could temper the current ECB rate hike bets and help elevate some of the pressure on the common currency.
Investors with an interest in the Pound Sterling to Euro (GBP/EUR) exchange rate will also be focusing on the UK’s Construction PMI.
Although the construction sector accounts for a smaller percentage of total UK growth than the services sector, last week’s soft manufacturing print caused notable Pound losses and signs of weakness in this area would also weigh on the Pound.
The Euro to Pound Sterling (EUR/GBP) exchange rate was trending in the region of 0.7808
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.2802
The Pound Sterling to US Dollar (GBP/USD) exchange rate is currently trending in the region of 1.5295
The US Dollar to Pound Sterling (USD/GBP) exchange rate is trading in the region of 0.6534
