Pound Sterling to Euro (GBP/EUR) Exchange Rate Recovers CPI Inspired Losses
The Pound Sterling to Euro (GBP/EUR) exchange rate managed to recoup the losses recorded in the immediate aftermath of the release of the UK’s Consumer Price Index over the course of trading.
The belief that the drop in consumer prices will benefit consumers saw the Pound rally against several of its most traded rivals, and the GBP/EUR exchange rate prepared to close out the European session trading in the region of 1.2583, up 0.1% on the day’s opening levels.
Tomorrow’s UK employment figures and the publication of the Bank of England’s meeting minutes will impact the GBP/EUR exchange rate.
Earlier…
GBP/EUR Exchange Rate Softens after UK Inflation Stats
With the pace of UK inflation falling by more than anticipated in November, easing from from 1.3% to 1.0%, the Pound Sterling to Euro (GBP/EUR) exchange rate eased lower.
The Euro’s performance was a little marred by a mixed bag of PMI reports for the Eurozone and its largest economies but the GBP/EUR pairing could extend losses as the European session progresses.
The German ZEW economic sentiment survey came in at 34.9 in December, a marked improvement on the 11.5 reading recorded in November and smashing expectations for a result of 20.0.
The GBP/EUR exchange rate fell to a low of 1.2492.
Earlier…
GBP/EUR Exchange Rate Could Advance if UK Inflation Climbs
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.2550 on Tuesday, down slightly on the day’s opening levels.
While today’s UK Consumer Price Index could have a profound impact on GBP/EUR trading, particularly if the figure comes in above or below the 1.2% reading expected, the manufacturing and services PMI’s from the Eurozone will also influence the direction taken by the Pound to Euro exchange rate.
If the gauges show the improvements forecast by economists, the Euro could rally.
Earlier…
The Pound Sterling to Euro (GBP/EUR) exchange rate was trading in the region of 1.2605 during the European session after softening slightly in response to a steep decline in UK house prices.
GBP/EUR Exchange Rate Trends in Narrow Range
The GBP/EUR exchange rate moved between highs of 1.2644 and lows of 1.2602 on Monday as investors responded to a Rightmove House Price report showing a -3.3% month-on-month slide in house prices in December.
While the drop in property values was the largest recorded monthly fall, Pound declines were limited as Rightmove asserted that it expects UK property prices to rebound in 2015.
That being said, Rightmove director Miles Shipside did indicate that the UK housing market is unlikely to heat up to the extent it did at the beginning of this year. He stated; ‘The Bank of England have worked hard through the Mortgage Market Review (MMR) to make sure things slow down. A steady market is a lot better because it stops personal indebtedness getting too high when people take out large mortgages to pay for ever increasing values in property. A sensible upwards trend is traditional for a healthy market but things got a bit too frothy last year and that couldn’t continue.’
The Pound Sterling to Euro (GBP/EUR) exchange rate held its modest declines as the European session progressed and the Confederation of British Industry’s Trends Selling Prices and Trends Total Orders reports advanced by more than expected.
Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast
Tomorrow the Pound Sterling to Euro (GBP/EUR) exchange rate is likely to experience considerable movement due to a variety of factors.
Early in the European session the Euro could gain if the measures of the Services/Manufacturing sectors of the Eurozone and its largest economies are shown to have expanded in December,
Economists have forecast that French Manufacturing PMI increased from 48.4 to 48.6 in December, holding below the 50 mark separating growth from contraction.
German Manufacturing PMI is believed to have risen from 49.5 to 50.3, taking it back above the 50 mark separating growth from contraction.
These results would help the Eurozone’s Composite PMI increase to 51.5 from 51.1.
Strong readings would bolster the Euro, and the Pound Sterling to Euro (GBP/EUR) exchange rate could fall further if the pace of UK consumer price inflation slows as forecast. It is expected that CPI slipped from 1.3% to 1.2% on the year in November.
The Bank of England has forecast that the rate of inflation will fall below 1% over the next six months.
A final flurry of Pound Sterling to Euro (GBP/EUR) exchange rate movement will be caused by the German ZEW economic sentiment/current situation surveys.
Pound Sterling (GBP) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Pound Sterling,
,US Dollar,1.5665,
Pound Sterling,,Euro,1.2606,
Pound Sterling,,Australian Dollar,1.9011,
Pound Sterling,,New Zealand Dollar,2.0210,
US Dollar,,Pound Sterling,0.6381,
Euro,,Pound Sterling,0.7931,
Australian Dollar,,Pound Sterling,0.5259,
New Zealand Dollar,,Pound Sterling,0.4913,
[/table]
