While it fell sharply against the Pound last week, the Euro could see a recovery in the near-term on Brexit and Eurozone-wide news.
Over September 14th and 15th, the EUR GBP exchange rate dropped from 0.9022 to 0.8790 after hopes for a UK interest rate hike rose.
Euro Outlook: Greek Bailout Review Clearance could Boost EUR
The Euro may be in for a surge against the Pound before the end of 2017, depending on how Greece handles its bailout obligations.
The country has long been forced to implement harsh austerity measures to prove that it can meet the requirements for further bailout funding, but hopes are that the review for 2018’s funds could be passed in 2017.
Issuing a confident statement was Nikos Pappas, Greek Digital Policy Minister. Pappas declared that;
‘We hope to conclude [the review] before the end of the year. There is absolutely no reason to have any delays. If there are delays, it is not going to be because of Greece’.
This would effectively grant Greece a large amount of breathing room, enabling the country to look forward to its economic recovery rather than spend all of 2018 worrying about economic obligations.
Assuming that Greece manages to pass the 2018 review early and with ease, the Euro could rise noticeably against the Pound.
Pound Crash Possible on May’s ‘Brexit Blueprint’
Looking to the near-future, the Pound could turn volatile this week when Prime Minister Theresa May gives a speech on Brexit.
May’s much-awaited remarks will come in Florence on Friday, where some believe the Prime Minister will make a tentative offer on the controversial ‘divorce bill’ for leaving the EU.
The exit price for the UK to pay has been a sticking point for a number of EU officials, particularly as it could hold up negotiations until it is actually resolved.
An unidentified senior Conservative has stated that party officials would accept a £40bn exit price, and that;
‘None of my colleagues would vote against leaving the EU on the basis of that figure. [Suggesting this sum would be] broadly in the spirit of cooperation, as long as it is reciprocated’.
While acceptance of a ‘reasonable’ bill payment could be a positive outcome for May, the Prime Minister may also face trouble if Boris Johnson is mentioned.
The Foreign Secretary has recently reopened old wounds by reprinting the claim that the UK could deliver £350m to the NHS by leaving the EU.
The claim, made infamous by being printed on a bus that toured the country, remains factually dubious and could bring difficulties for May.
If the PM is taking questions then Johnson’s claims may well come up, potentially unsettling the Prime Minister if they prove a clashing point between two of the highest-profile government figures.
Recent Interbank EUR GBP Exchange Rates
At the time of writing, the Euro to Pound (EUR GBP) exchange rate was trading at 0.8803 and the Pound to Euro (GBP EUR) exchange rate was trading at 1.1356.
Comments are closed.