Eurozone Data to set today’s pace
There is a flurry of important Eurozone economic data at 10 am this morning which will provide some insight into the performance of the Eurozone economy in Unemployment, Inflation and GDP, Gross Domestic Product. This will set us up for a very busy end to the week which will see interest rate decisions from the UK and the US, both of which are likely to impact Euro rates. If you are considering an exchange buying or selling Euros read on to find out more or, for a more detailed analysis of your situation, please email me Jonny directly on email@example.com
Economic news in the Eurozone has generally been positive with the ECB, European Central Bank, pitching the market that they will be raising interest rates towards the end of summer 2019. This has helped the Euro to remain firm against all currencies and the expected positive data sets this morning should reinforce that view.
Will Euro buyers and sellers get a surprise this afternoon?
Unemployment might have risen slightly but unless the other figures are concerning, there is nothing that should trouble the Euro too much. What could be more interesting today is that it is the end of the month and this will sometimes see ‘month-end flows’ which can trigger unexpected shifts. An example would be a very large business, or perhaps even a bank or large institutional investor like a pension fund, with a surplus amount of Euros, trading into sterling to repatriate the profits. Such movement is always a possibility at the end of a month and will only favour those who have made plans and are aware it might happen.
The rest of the week is noisy with the US Federal Reserve interest rate decision Wednesday evening and the latest UK interest rate decision and quarterly inflation report on Thursday. These releases will influence the Euro in that EURUSD is the most heavily traded currency pair, so any big movements on the US dollar will drag and pull the Euro against other currencies.
GBPEUR and EURUSD opportunities will favour the well-prepared
For example, a stronger US dollar if the Fed raise rates tomorrow, will see a stronger US dollar and a weaker Euro. This would weaken the Euro against its counter-parties so if the Fed do hint tomorrow at raising rates in September as many expect, we could see better rates for Euro buyers.
Any relief for sterling holding, looking to buy Euro, might be short-lived with the Bank of England decision just 17 hours later. Sterling is on the back-foot and it is my opinion that only some real positive news from Mark Carney and his team will see the pound fare well. The scope for disappointment is high, clients looking at maximising any GBPEUR positions, buying or selling, are in for a busy week. Extra preparation in money matters is usually a good idea!
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