GBP/EUR exchange rate muted amid lull in data
The pound euro (GBP/EUR) exchange rate is firming this morning despite a lack of both UK and Eurozone economic data releases.
At the time of writing the GBP/EUR exchange rate is trading at around €1.1882, up roughly 0.2% from this morning’s opening rate.
Euro (EUR) to dip following Eurozone inflation?
All eyes will be on this week’s upcoming inflation print, where the euro (EUR) could falter against its peers should the data print as expected.
Augusts’ headline inflation reading is forecast to cool from 2.6% to 2.2%, and is expected to move closer to the European Central Bank’s (ECB) 2% target.
Core inflation is also forecast to fall in August, with the rate expected to drop from a previous reading of 2.9% to 2.8%.
Should Friday’s data release match expectations and confirm an overall slowdown in Eurozone inflation, this could serve to ramp up ECB interest rate cut bets further, and in turn stymie the common currency.
In the interim, will a fall in the Eurozone’s largest economy’s inflation print hobble EUR exchange rates tomorrow? Or will Germany’s inflation reading differ from expectations and undermine further rate cut speculation?
Pound (GBP) to be driven by risk appetite?
The pound (GBP) is trading sideways against the majority of its peers this morning as a continued lull in UK data releases sees the pound struggle to catch bids.
Also tempering with the pound’s trade this morning is an unclear market mood.
As an increasingly risk-sensitive currency, this morning’s uncertain trading conditions have further weighed on GBP exchange rates.
Looking ahead, as UK data will remain absent for the remainder of this week, the pound could continue to be moved primarily by market mood.
Will a shift to upbeat trade support Sterling later today? Or will an uncertain market mood continue to stymie the pound?
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