The EUR lost some ground against Sterling yesterday, following reports that a Brexit transition deal has all but been agreed.
GBP/EUR rates dropped to 1.1434, before recovering during afternoon trading. It moved back below the 1.14 threshold and has held firm this morning, with UK inflation data doing little to boost Sterling’s value this morning.
The EUR has for the most part been very well supported of late, following some bullish comments from the European Central Bank (ECB). It’s President Mario Draghi confirmed that the central bank intend to wind up their current monetary policy programme by the end of this year, news which indicates that the Eurozone economy no longer needs to be supported by an external bond buying scheme.
The ECB have remained steadfast in their commitment to their Quantitative Easing (QE) initiative over recent months, which has helped support the Eurozone economy in recent times. The Eurozone’s economic output has exceeded almost every expectation and this has allowed the EUR to sustain the gains it has made against most of the major currencies.
Yesterday’s developments however, do indicate that it may be time to consider any EUR sell positions, particularly for those clients looking to buy Sterling.
The UK’s chief Brexit negotiator David Davis and his EU counterpart Michel Barnier, confirmed that a “decisive step” had been made and investor confidence in the UK economy immediately surged.
Looking ahead and we’ve got a busy few days ahead. Tomorrow we have the official UK Unemployment rate, followed by UK Retail Sales figures and the latest BoE interest rate decision and monetary policy statement on Thursday. We also have Eurozone Manufacturing data released that day but it likely that the markets focus will be on the EU summit, which will dominate the majority of headlines. With the next phase of Brexit talks underway on Friday, during the second day of the summit, it is likely that there will be a lot volatility on EUR exchange rates over the coming days.
If you have an upcoming Euro currency transfer to make, you can contact me directly on 01494 787 478. We can help guide you through this turbulent market and as a company we have over eighteen years’ experience, in helping our clients achieve the very best exchange rates on any given market.
Our award winning rates can be accessed very easily over the phone and I can keep you posted with key market developments ahead of any prospective exchange you need to make.
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