A below-forecast UK Markit Manufacturing PMI left the Pound trending in a weaker position against both the Euro and US Dollar on Monday
Pound Sterling to Euro (GBP/EUR) Exchange Rate News – Moves away from 1.40 Despite Greek Default Concerns
As the European session opened, a lack of progress in the Greek bailout negotiations over the weekend pushed the Pound Sterling to Euro currency pair higher.
The GBP/EUR exchange rate briefly achieved a high of 1.3991 and managed to continue trending around this level as final Manufacturing PMIs for Germany and the Eurozone printed below initial flash forecasts.
However, after the UK’s own manufacturing index printed at 52.0 in May (rather than achieving the 52.5 level expected by economists) the Pound shed previous gains and the GBP/EUR exchange rate brushed a low of 1.3916.
With German inflation data still to come, further GBP/EUR currency movement can be expected.
Later…
As expected by economists, the German Consumer Price Index printed at 0.1% on the month and 0.7% on the year. However, the Euro failed to derive much benefit from the report as Grexit concerns continued to take a toll on the common currency.
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.3921
Pound Sterling to US Dollar (GBP/USD) Exchange Rate News – Pound Drops 0.5% before US ISM Manufacturing Report
While the UK’s disappointing manufacturing report saw the Pound decline against the Euro, the British currency also fell by 0.5% against the US Dollar on Monday.
The Pound Sterling to US Dollar (GBP/USD) exchange rate hit a low of 1.5194 ahead of the release of a number of influential US ecostats, including the nation’s Personal Income/Spending/Consumption data.
However, while these reports will be of interest, the direction taken by ‘Cable’ is more likely to be down to the US ISM Manufacturing measure for May.
If the gauge rises from 51.5 to 52, as projected, the US Dollar could extend gains against its British peer.
The Pound Sterling to US Dollar (GBP/USD) exchange rate is currently trending in the region of 1.5268
Euro to US Dollar (EUR/USD) Exchange Rate Forecast – Euro Plummets 0.7% but Could Rebound on German Inflation
Although final Manufacturing PMI’s for France and Italy were positively revised on Monday, the measures for Germany and the Eurozone as a whole came in lower than expected.
In Markit’s report it was stated; ‘Output growth in Germany slowed sharply to a five month low in May. The rates of increase in both total new business and new export orders also remained muted, in turn slowing the pace of job creation.’
This sign of weakness in the Eurozone’s core put pressure on the Euro.
However, if today’s German Consumer Price Index shows the inflation increase expected by economists, the EUR/USD pairing may advance in the hours ahead.
German inflation is believed to have risen by 0.1% on the month in May and to be up 0.7% on the year. Data which matches or exceeds these predictions would be Euro-supportive.
The Euro to US Dollar (EUR/USD) exchange rate was trending in the region of 1.0919
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