The British Pound to Euro (GBP/EUR) exchange rate recorded gains on Wednesday ahead of the UK BBA Loans for House Purchase stat.
The British Pound to Euro (GBP/EUR) exchange rate was trending in a tight range during the first half of Tuesday’s European session as Bank of England (BoE) Governor Mark Carney testified to the Commons Treasury Committee.
Governor Carney discussed interest rates, inflation, Greece, bank conduct and wages with a hawkish edge, suggesting that ‘more likely than not’ interest rates will have to be raised in order to combat low inflation, ‘over the forecast horizon’.
In addition, as Greek negotiations continue, Carney commented on the prospect of a Greek exit from the Eurozone, saying: ‘If there were to be a disorderly exit of Greece we would expect that this would have ramifications for asset prices more broadly and potentially for confidence, and that those improvements in the institutional structure in the Euro area would need to be used to reduce that.’
Greece submitted reform proposals to Eurogroup heads late on Monday evening and as a result, finance ministers will have a telephone conference at 14:00 GMT on Tuesday to discuss the requests. The Greek proposal has been viewed by creditors as reasonable, treading the fine line between their demands and Greek government’s pledges.
Industry expert Duncan Weldon commented: ‘The big picture Greek reform programme well short of Syriza election programme but with important wins for the new government.’
Any developments from the conference call today could cause major Euro to British Pound (EUR/GBP) exchange rate fluctuations.
British Pound to Euro (GBP/EUR) Exchange Rate Forecast
The British Pound to Euro (GBP/EUR) exchange rate could fluctuate later in Tuesday’s session when European Central Bank (ECB) President Mario Draghi speaks in Frankfurt.
Thursday could be a massively influential day for British Pound to Euro (GBP/EUR) exchange rate trading with the release of German Unemployment Rate and Unemployment Change stats, as well as UK Gross Domestic Product figures.
Any favourable UK ecostats could see a rise in Bank of England speculation that interest rate hikes may be on the horizon. Recent weeks have seen the UK Unemployment Rate fall from 5.8% to 5.7%—an event that suggested labour market slack is tightening and the BoE may be moving closer to increasing borrowing costs.
Euro trading will continue to heat up on Friday when German Consumer Price Index (CPI) stats emerge.
The British Pound to Euro (GBP/EUR) exchange rate is trading at 1.3634. The Euro to British Pound (EUR/GBP) exchange rate is trending in the region of 0.7336.
