The Euro to Pound exchange rate was little moved on Friday as worries over increasing tensions in Ukraine continued to weigh on investor sentiment.
With a lack of domestic economic data releases out of the Eurozone the single currency remained under pressure from yesterday’s comments made by European Central Bank President Mario Draghi. Mr Draghi said in a speech in Amsterdam that the Euro exchange rate is an increasingly important factor for the bank when it comes to monetary policy. He added that the bank’s monetary policy could be affected if the Euro continued to strengthen.
Earlier in the session Sterling made gains against the Euro and other peers as UK retail sales data came in better than economist forecasts. On a monthly basis sales increased by 0.1% in March beating expectations for a fall of 0.4%.
Also giving Sterling support was the release of separate report which showed that the number of mortgage approvals in the UK increased by 45,900 in March, beating expectations for a rise of 48,900.
The positive data added to expectations that the UK will post strong economic growth for the first quarter of the year.
As the session progressed and concerns over Ukraine increased the Euro to GBP settled into the 0.82 region and was little changed.
Investors grew nervous as the war of words between the West and Russia intensified. Russia warned Ukraine that it would face justice for the killing of five pro-Russian separatists yesterday. 40,000 Russian troops are massed on the Ukrainian border and worries that an invasion could occur have intensified.
Next week promises to be busy for the Eurozone with a wealth of data releases due.
Monday sees the publication of the latest retail sales data out of Germany and the publication of a consumer confidence report out of Italy.
Tuesday will be dominated by Eurozone sentiment and confidence reports as well as a German inflation report. If the region’s largest economy posts a decline in inflation then pressure will rise on the ECB to introduce measures to tackle the regions low inflation problems.
Wednesday sees the release of region wide inflation data as well as unemployment figures for Italy and Germany. Those reports are likely to highlight the unevenness of the region’s economic recovery.
The end of next week could cause volatility for the single currency due to the release of the latest Eurozone unemployment figures. If the jobless rate increases from 11.9% we can expect the Euro to weaken.
Euro Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Euro,
,Pound Sterling,0.8232 ,
Euro,,US Dollar,1.3844 ,
Euro,,Canadian Dollar,1.5237 ,
Euro,,Australian Dollar,1.4898 ,
Euro,,New Zealand Dollar,1.6127 ,
US Dollar,,Euro,0.7223 ,
Pound Sterling,,Euro,1.2147 ,
Canadian Dollar,,Euro,0.6555 ,
Australian Dollar,,Euro,0.6716 ,
New Zealand Dollar,,Euro,0.6200 ,
[/table]
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