Pound Sterling to Euro (GBP/EUR) Exchange Rate Down 0.4% after Construction Report
The Pound Sterling to Euro (GBP/EUR) exchange rate extended recent declines during the European session as the UK published below forecast Construction Output figures.
Output was shown to have slumped by -2.2% in October rather than gaining the 0.7% anticipated.
The GBP/EUR exchange rate could fall further before the weekend if the Eurozone’s industrial production report impresses.
Earlier…
The Pound Sterling to Euro (GBP/EUR) exchange rate briefly fell back below 1.26 on Thursday as the pace of UK house price growth slowed to an 18-month low.
GBP/EUR Exchange Rate Trends Lower as House Price Growth Slows
The Royal Institute of Chartered Surveyors (RICS) House Price Balance index slid from 20 in October to 13 in November, an 18-month low. A more moderate decline to 15% had been anticipated.
The GBP/EUR pairing was little changed after Germany’s final inflation figures for November were left un-revised from previous estimates.
Today’s speech from Bank of England (BoE) official Ian McCafferty could prompt some Pound Sterling to Euro (GBP/EUR) exchange rate volatility.
Earlier…
The Pound Sterling to Euro (GBP/EUR) exchange rate failed to claw back declines during local trading in spite of some comments issued by Bank of England (BoE) Governor Mark Carney.
GBP/EUR Exchange Rate Advances as Carney Says Rates Will Rise
The Pound Sterling to Euro (GBP/EUR) exchange rate continued trending 0.2% lower against the Euro as investors digested remarks made by Carney in an interview with the Birmingham post.
The comments reiterated remarks previously made by the BoE chief concerning interest rates being increased despite declining inflation levels, so they gave the Pound little support.
Carney stated; ‘What that means though, for this economy to have balance and inflation to get back to 2% over the next few years, is that […] interest rates are going to have to increase. We don’t know the precise timing that will start, but what we are emphasising… is the path of interest rate adjustments… is expected to be a gradual set of interest rate increases and to a more limited extend than the past.’
Earlier…
The Pound Sterling to Euro (GBP/EUR) exchange rate held onto previous declines as the European session progressed, failing to benefit from the news that the UK’s trade deficit narrowed in October.
GBP/EUR Exchange Rate Trends Lower as BCC Comments offset Deficit Decline
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.2648 on Wednesday.
Although the UK’s trade deficit in goods and services was shown to have narrowed from 2.8 billion Pounds in September to 2.0 billion Pounds in October (a seven-month low) demand for the Pound was undermined by comments issued by the British Chambers of Commerce (BCC).
The BCC lowered its UK growth forecast for 2014 to 3.0% (down from a previous estimate of 3.2%) and cut its growth projection for 2015 from 2.8% to 2.6%.
The weakness in the GBP/EUR exchange rate also persisted as the BCC intimated that premature interest rate increases could prove disastrous for the UK’s recovery.
Earlier…
The Pound Sterling to Euro (GBP/EUR) exchange rate fell back below 1.27 as the week progressed and investors digested disappointing UK data.
GBP/EUR Exchange Rate Demand Undermined by Slide in Industrial Production
On Tuesday the Pound Sterling to Euro (GBP/EUR) exchange rate softened following the publication of below-forecast UK manufacturing and industrial production reports.
Instead of advancing by 0.2% on the month, as expected, manufacturing production fell by -0.7% and industrial production slid by -0.1%.
The Euro’s modest uptrend against the Pound was aided by a better-than-expected German trade report.
Greek Election Concerns Fail to Shake Euro (EUR) Exchange Rate
The Pound Sterling to Euro (GBP/EUR) exchange rate was little affected by the shock news that Greek Prime Minister Antonis Samaras is to hold a snap election next week.
If the ruling coalition fails to generate enough support behind its candidate, Stavros Dimas, the SYRIZA leader Alex Tsipras could assume control.
As Tsipras is euro-sceptic, a victory for SYRIZA could put Greece’s place in the Eurozone in doubt.
Samaras said of the decision; ‘While we had stabilised ourselves financially and embarked on a period of recovery, clouds of instability were forming inside Greece. [The election has been called] to remove uncertainty and reinstate political stability. With the presidential election from the Greek parliament the clouds will have cleared up and our country will be officially ready to embark in the post-bailout era’.
However, while Greek stocks plummeted in response to the development, the Euro is weathering the prospect of political upheaval in the nation very well and has so far managed to avoid a sharp declination.
Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast
Later today the Pound Sterling to Euro (GBP/EUR) exchange rate may be able to recoup some of its recent losses thanks to the UK’s trade data.
Economists have forecast a narrowing in the UK’s trade deficit.
If that proves to be the case, it will be Pound beneficial.
Further GBP/EUR movement could be caused by a speech to be given by European Central Bank (ECB) official Benoit Coeure.
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,1.5673,
Pound Sterling,,Euro,1.2649,
Pound Sterling,,Australian Dollar,1.8853,
Pound Sterling,,New Zealand Dollar,2.0340,
US Dollar,,Pound Sterling,0.6378,
Euro,,Pound Sterling,0.7903,
Australian Dollar,,Pound Sterling,0.5302,
New Zealand Dollar,,Pound Sterling,0.4913,
[/table]
