While the Euro continues to trade strongly against the US Dollar today after jumping to 1.30 US cents during the North American session, the common currency has softened slightly against the Pound due to a variety of factors.
The Euro to Pound Sterling Exchange Rate was in the region of 0.8633 as of 12:10 GMT
Federal Reserve Chairman Ben Bernanke’s insistence that US employment and inflation has to improve before accommodative easing can be reassessed saw the US Dollar plummet against its peers and the Euro briefly hit 1.32 against its American rival before a downward correction saw it trading in the region of 1.30.
The Euro was also boosted against several of its other currency peers, although it lost ground against a bullish Yen.
However, with the Pound strengthening on speculation that its recent drop had been excessive, the Euro edged away from the fleeting high of 0.8802 pence per Euro, returning to its recent 85.5 – 86.5 range.
Eurozone news also weighed on the EUR/GBP pairing.
Firstly, the European Central Bank’s report intimated that additional rate cuts could occur if economic conditions made it necessary. It also shed some light on Mario Draghi’s recent, rather forward looking, policy statement.
In the document the ECB asserted: ‘The extended period of time over which the Governing Council currently expects the key ECB interest rates to remain at present or lower levels is a flexible horizon which does not pre-specify an end-date but is conditional on the Governing Council’s assessment of the economic fundamentals that determine underlying inflation.’
The Euro to Pound (EUR/GBP) exchange rate hit a low of 0.8534 pence per Euro
Meanwhile, data compiled by ELSTAT showed that the Greek unemployment rate jumped to a fresh record high of 26.9 per cent in April.
Staggeringly, youth unemployment in the struggling nation was shown to stand at 57.5 per cent, ever so slightly lower than the previous month’s 58.3 per cent level.
The report prompted this response from economist Angelos Tsakanikas: ‘The important fact is that almost two in three have been out of work for over 12 months’ – a very concerning factor as any turnaround in employment conditions will take a fairly long time to have a positive impact.
An Italian bond sale also took place today, and although Italy sold almost 5 billion Euros of government debt, demand was limited.
With UK economic news in short supply for the rest of the week movement in the EUR/GBP pairing is likely to be restricted, but could occur tomorrow in response to industrial production data for the Eurozone.
Current Euro (EUR) Exchange Rates
< Lower > Higher – Little Changed
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3063 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8633 <
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4176 >
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6548 <
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7658 <
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1578 >
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.7057 <
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6043 >
(Correct as of 12:10 GMT)
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