As the European session opened the Euro was trading close to a seven-week high against the Pound but was slightly softer against the ‘Greenback’ having pared an advance recorded during North American trading as a result of sub-par US employment data.
The Euro to Pound Exchange Rate is currently trading in the region of 0.8520 as of 15:40 GMT
While the common currency was holding relatively steady prior to the publication of a consumer confidence gauge for the Eurozone, it was able to consolidate gains against Sterling as minutes from the Bank of England’s latest policy meeting indicated that the Monetary Policy Committee believe that UK unemployment will fall more rapidly than expected. The BoE’s decision to tie the unemployment rate to interest rate hikes means that this news could add to the case for a rate increase occurring before the 2016 target initially outlined.
Consequently, the Pound came under pressure and the Euro was able to advance.
As trading progressed the Euro was also supported by the news that Spain eked out growth of 0.1 per cent in the third quarter of the year, taking the country out of a two-year recession.
While Spanish Prime Minister Mariano Rajoy commented on the ‘gradual’ nature of the nation’s recovery, economist Robert Wood did assert; ‘We are optimistic on the Euro periphery as a whole and Spain in particular. The country has made big structural changes, it’s been engaged in a lot of deficit reduction, business sentiment is improving and unemployment is probably close to a peak’.
The EUR/GBP Exchange Rate hit a high of 0.8556
Further Euro gains were made as a report showed that consumer confidence in the Eurozone improved again in October, rising from -14.9 to -14.5 as expected.
The last time the European Commission’s sentiment measure produced such a positive reading was when it hit -11.2 in mid 2011.
Although still below the historic average of -13.3 this result adds to hopes that the 17-nation currency bloc’s return to growth may become less fragile in the months ahead.
Across the European Union confidence held at -11.7 in October.
Tomorrow significant Euro movement could occur as a result of German/Eurozone services and manufacturing PMI for the Eurozone.
Economists have forecast that the reports will show that the services and manufacturing sectors of both the Eurozone and its largest economy expanded in October, with Eurozone and German manufacturing growth accelerating.
If accurate the Euro’s bullish relationship with the Pound could continue ahead of Friday’s UK GDP data.
Current Euro (EUR) Exchange Rates
< Lower > Higher
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3783 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8520 >
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4330 >
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6398 >
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7262 >
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1738 <
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6982 <
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6092 <
(Correct as of 15:40 GMT)
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