The EUR has started to recover some of the ground it had lost against GBP and the USD of late, with today’s positive Trade Balance figures helping to support its rise in value.
GBP/EUR rates have moved back under 1.17, whilst EUR/USD sit at a six-month high at 1.1065.
This move has brought about some much-needed respite to those clients holding the single currency, who had seen its value diminish over recent weeks.
Whilst the markets still remain cautious, this improvement could present the perfect opportunity for those clients looking to sell short-term EUR positons.
In my opinion the main reasons for the improvement are based more around the reciprocal currencies downturn, rather than an overriding investor confidence in the EUR. The USD is struggling of late and I have already discussed the Pound’s problems following rising inflation levels and stagnant wage growth. This in turn has inadvertently boosted the single currency and has given clients and investors alike a window of opportunity.
Looking at the Eurozone region and there are still many negative variables to consider, including political elections in Germany and the on-going debacle with Greece’s seemingly impossible repayment structure. There have been some positive moves, in particular the French election results and seemingly a move away from the far-right movement. However, personally I do not have enough confidence that the single member states can move together in one entity, with further problems likely to occur over the coming weeks and months.
The European Central Bank (ECB) have already had to extend their monetary policy (QE) programme, which is where they inject additional funding to help support their economy and whilst ECB president Mario Draghi remains upbeat as usual, this in itself is a telling sign that all is not well inside the region.
Personally, I would look to protect the gains made ahead of the ongoing Brexit detachment saga and the other potential negative issues I mention above.
If you have an upcoming EUR currency transfer and would like to be kept up to date with all the latest market movements, or simply wish to compare our award-winning exchange rates with your current provider, then please feel free to contact me on 0044 1494 787 478 and ask one of the team for Matt.
Alternatively, I can be emailed directly on firstname.lastname@example.org.