The EUR has enjoyed a positive run throughout Monday’s trading, despite on-going political uncertainty in Italy and new developments in Spain.
Italian politics has never been straightforward and despite the Five Star Movement and Lega finally being sworn in as the new Italian government, there are still many unanswered questions.
Despite fears of a return to the polls in Italy being quelled, the alternative is perhaps even more un-nerving, especially for any Euro stalwarts. Both parties have promised to tackle Italy’s significant and mounting debt but even more poignantly, have promise to address the perceived Eurozone imbalance the country suffers from.
Whilst a major sell-off of the EUR has so far not materialised, perhaps because both parties stopped short of threatening to leave the single bloc altogether, the developments over recent days are hardly likely to drive investors’ confidence in the EUR.
Despite these concerns those clients who have kept hold of any Euro positions have had a profitable day. GBP/EUR rates have fallen back below 1.14, with the single currency hitting 1.1379 at its high earlier this afternoon.
EUR/USD rates have also improved, hitting 1.1744 at today’s high. Despite this spike, it is relevant to note that the greenback found plenty of support around this level, fighting back below 1.17 by the close of European trading.
Alongside the obvious concerns with Italy, there were also developments in Spain’s parliament over the weekend. The former Spanish Prime Minister Mariano Rajoy was ousted on Friday following a vote of no confidence by MP’s in Madrid, which came in the wake of the corruption scandal. As fears once again resurfaced regarding the possibility of Catalan independence, it is clear that all is not well inside two of the Eurozone’s largest economies.
The Eurozone economy itself has come off the boil in recent months and whilst the current growth forecasts remain solid enough, it may be time for those clients holding Euro to consider their position in light of recent developments.
If you have an upcoming EUR 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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