Category Archives: Euro Strength

GBPEUR rates wobble

GBPEUR rates have started to wobble this week as we have entered the new economic cycle for September.  This week is scheduled to be a very volatile week and we have already seen this this morning with the value of the Pound fell by over 0.5 cent in the space of 15 minutes. This was seen following a recent poll on the voting scheduled to take place in over 2 weeks’ time in Scotland. This showed that the vote was a lot closer than many had previous thought. Moving forward we have a host of economic data due tomorrow morning and then the European Interest rate decision on Thursday. The Europeans are in trouble at the moment as inflation has fallen to a 5 year low, the pressure has been building for the bank to introduce new policies which we saw explode into the papers last week when the French government changed.

So forecasts – well today I expect the euro to continue to gain. Tomorrow to be a volatile morning and a quite afternoon. On Thursday to be GBPEUR positive. So buyers hold till Thursday, and sellers trade today potentially.

For more information or to talk through this in more detail please feel free to get in contact on hse@currencies.co.uk

Look forward to hearing from you.

GBPEUR inflation data this week

GBPEUR levels have remained flat this week in the build up to the new month. With it a new round of economic data will be released probably returning the market to a volatile trading sessions. It was over the weekend when we have the large movement on the market. This was following the new information published from the central banks either side of the channel at their most recent meeting. The Bank of England is now forecasted to not raise interest rates until next year, the European Central Bank has a lot left on its cards. As inflation continues to fall and member states continuing to battle between then on further austerity or spending cracks are beginning to form.  The French government was the last to bubble over this week when a new government was formed following top officials coming out against the leadership.  This all means that speculation is building that the central bank could start a new round of quantitative easing in an effort to give banks access to further cheap money.

This however is a topic for speculation in the medium term, in the short term look out for economic data from Europe on Friday morning. This is when fresh inflation data is released and along with it a changing view and forecast will be made on the future policy of the bank and therefore the euros price.  All a little confusing I know but please remember the market moves on rumour more than fact and any change to forecasts can make a bigger difference to prices than an actual change as the market tried to second guess future changes in policy.

For more information or a full break down of the above and how it could effect you contact the author STEVE EAKINS at hse@currencies.co.uk

Why has Sterling fallen against the Euro recently (Tom Holian)

Exchange rates for the currency pair GBP vs EUR have fallen by almost 3 cents since the 2 year high hit in late July. The reason for the previous highs was because it was suggested that UK interest rates may go up before the end of the year but recent data has put that in doubt.

Shortly after the release of The Quarterly Inflation Report last week Bank of England governor Mark Carney was asked to comment on interest rates but he said he would not discuss it at that time which saw Sterling fall quickly against the single currency as investors saw it as a sign that the likelihood of a rate hike is further away.

Indeed, the inflation data out on Tuesday showed a fall from 1.9% down to 1.6% which again saw Sterling fall. The Bank of England’s target for inflation is 2% and if inflation rises the common policy to be used is to increase interest rates. Therefore, as the data was lower this has spooked investors.

UK Retail Sales growth was weaker than many expectations as they went up by just 0.1% compared to the expected 0.4%. With the retail industry the biggest measure of GDP then a fall is likely to have a negative impact on future growth. Again, another reason for the fall for the Pound vs Euro.

The Bank of England minutes showed that 2 on the 9 members voted for a rate hike from 0.25% to 0.75% but owing to the inflation data I think next month we could see a change of mind.

With the bank holiday weekend coming up if you’d like to get more information about saving money when buying Euros then contact me directly Tom Holian teh@currencies.co.uk

 

 

Where Next for EUR Exchange Rates? (Matthew Vassallo)

The EUR had broken through 1.25 against GBP earlier this week but the spike was short lived, with the latest Bank of England (BoE) minutes pushing the Pound back above this threshold. The EUR made gains against Sterling earlier this week primarily because UK inflation data came out worse than expected, which in turn pushed the Pound’s value down. This is interesting as it shows when the EUR has strengthened recently it is not because any specific market confidence in the single currency.

Poor Eurozone PMI data released today will do little to change the perception of a EUR, which has been handicapped by a struggling, stagnant economy. GBP/EUR looks likely to remain range-bound between 1.23-1.27 in the short-term and I do believe the EUR will find protection in this range.

EUR/USD rates remain above 1.30 for the time being but with the recent improvements in the US economy, including yesterday’s Federal Reserve minutes, this level could soon be breached.

If you have an upcoming currency requirement 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 directly on mtv@currencies.co.uk

GBPEUR forecasts for today – when to buy/sell

Bank of England minutes today could make a real difference to rates of exchange this week.  Generally Sterling’s value has been sliding of late following comments by the bank of England at their Quarterly Inflation Report last week. This was when they painted a bleak picture for wage inflation this year which in turn has pushed back expectations of an Interest Rate rise until next year. Economic data from the UK recently has also showed a fall slowly eating away at the Pounds value.  Sterling has now lost nearly 4% against the USD for example over the last fortnight, falling from a 6 year high to a 6 month low in just 2 weeks. It highlights how quickly rates can change so if you have exposure to the market and would like more information please contact myself STEVE EAKINS via my email at hse@currencies.co.uk

Later this morning we have more data from the Bank of England in the form of their most meeting minutes. There are nine members of the MPC who vote and therefore make changes to policy. I think it is hugely unlikely that any members could have voted for a change however I am not with the majority of forecasters. Many think that one member could have made a vote for a change and if we saw this levels could change significantly. This is released at 9:30 so if you would like an update of this breaking news please register your interest by getting in contact. Last month Sterling was at a 2 year high before this report was released when thereafter levels dropped by over a cent so with this uncertainty in mind I would suggest anyone with a need to be ready to move very quickly.

For more information or to discuss your situation directly with me please email me at hse@currencies.co.uk

Thank you for reading,

Steve

What can we expect for the Euro in the future?

The Euro appears to be on course for future losses which may manifest in the next month or so owing to continued pressure on the Eurozone economy to show some improvements in their economic outlook. Some months ago we were in a similair position and Marios Draghi announced a range of measures to ease liquidity in the Eurozone – that is making money more cheaply available to try and stimulate the economy. Unemployment is still a big problem in the Eurozone and boosting growth will help to combat this problem.

The cutting of their base interest rate has so far failed to ignite the economy and stave off the deflationary pressures in the Eurozone. Last month’s data has so far all been rather worrying and I am of the opinion anyone holding out expecting larger moves back in their favour in the future should beware of the risk involved. If you look at the historic charts the GBPEUR rate used to be much higher in the past flirting with levels of 1.50 – 1.60 for a period of time. Therefore the more favourable recent moves which we have seen could be viewed as an anomaly never to return as the economic recovery in the UK gathers pace.

All in all a strong pound and rising Eurozone concerns seems to indicate to me a deterioration in the current levels for those selling euros for GBP. If you need to make an exchange now or in the future please contact me Jonathan on jmw@currencies.co.uk

UK Inflation Down So Pound Drops Versus The Euro (Colm Gilhooly)

After the big drop in GBP EUR rates last week following the Bank of England Quarterly Inflation Report it did look as if the pound was making some headway yesterday.  However inflation figures this morning showed official figures has dropped from 1.9% to 1.6% whereas they had expected to come in at 1.8%.  This lower than expected inflation figure means it is less likely the Bank of England will have to raise interest rates soon and reinforces their position from last week.

However Euro sellers beware as this spike in favour may not last indefinitely with a lot of European jobs and CPI data out next week, all of which is expected to be weak.  This could put pressure on the ECB for their September meeting and see the Euro slip so if you are selling Euros I would be inclined to take advantage of current levels either on spot or forward contracts.

If you are new to currency exchange and want a better idea of how it all works, or even if you are an experienced hand and just want to get the best exchange rate, then feel free to email me, Colm, at cmg@currencies.co.uk and I would be happy to explain how our services work.

Will the Euro weaken further soon?

There is a very strong chance the Euro will weaken further in the coming weeks and perhaps months if the current economic conditions deteriorate. Important measures of the Eurozone economy as a whole and the component countries have all showed a clear downturn of late. Eurozone Inflation has fallen lower and growth has stalled as the single bloc stumbles from crisis to crisis hurting confidence not only in the Eurozone but also globally. If  you would like to learn more about the forecast for your particular transaction we would be very interested to hear from you, please email me on jmw@currencies.co.uk

The Euro is slowly drifting into dangerous territory and anyone who needs to buy or sell euros will more than likely see the impacts of a deterioration or improvement in this situation. For more information at no cost or obligation please email me jmw@currencies.co.uk and I will be happy to help you.

 

With Much Of Europe On Holiday Today Can UK GDP Help Sterling Bounce Back? (Colm Gilhooly)

Sterling has had a torrid couple of days against the Euro following Mark Carney’s comments at the Bank of England Quarterly Inflation.  EU inflation figures yesterday weren’t particularly robust and GDP was slightly lower than forecast but the Euro was able to hold on to most of its recent gains despite this.  However it was not exactly a glowing endorsement that events in Europe are turning around, so I suspect the Euro will remain very vulnerable.

With UK GDP revisions due out today it could provide a small boost for sterling as long as the figures are at least on or above expectations, but I don’t think the pound will go shooting up in the short term as it is unlikely to affect the markets view on UK interest rates given Carney’s recent comments.  Next week we do have UK inflation and the Bank of England Minutes, but again I do not expect either to have a significant effect on the pound unless the minutes show one of the MPC voted for a rate hike this month (again unlikely following the inflation report and that all 9 voted to hold for the last few months).

To my mind this is currently a great selling opportunity for anyone holding euro and wanting to change euro to sterling for example from the proceeds of a property sale in France or Spain.  The UK economy will still likely be on track and at some point UK interest rates will go up, it is just a question of timing, and when they do the pound will rise again.  In contrast the Euro still has a lot of problems ahead and I cannot see interest rates there going up for years- and there is always the risk that they may change policy and potentially weaken the Euro eg through some form of Quantitative Easing program similar to the UK and the US.

If you need to make a currency transfer and want to get the best exchange rate, then feel free to email me, Colm, at cmg@currencies.co.uk and I would be more than happy to explain how our foreign exchange services work.

EUR Strength Despite Poor Industrial Production Figures (Matthew Vassallo)

The EUR has strengthened against GBP this morning, pushing GBP/EUR rates back to 1.25 on the exchange, despite opening the day above 1.26. This positive move for the EUR against the Pound has come about despite weaker than expected Eurozone Industrial Production figures, which indicates this move has been initiated by a lack of investor confidence in the Pound.

Weaker than expected UK employment data, coupled with Bank of England (BoE) governor Mark Carney’s speech, has drained investor confidence in the Pound, which has helped the EUR move away from the recent two year low and put pressure on 1.25. Whether this is a short-term realignment for the single currency, or the start of a longer-term positive trend, is likely to be dependent on the key economic data releases over the remainder of the trading week.

Tomorrow we have a host of key Eurozone data, including inflation figures and Gross Domestic Product (GDP) figures. GDP figures are always seen as key releases by investors, as they give an indication into the relative health of that country’s economy and its growth prospects. With figures expected to come in worse than previous we may find the EUR’s momentum is short lived but any figure above the expected 0.7% is likely to push GBP/EUR rates below 1.25 on the exchange. Friday see’s the release of the latest UK GDP figures and again this release is likely to cause additional volatility for GBP/EUR exchange rates.

If you have an upcoming currency requirement and you 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 directly on mtv@currencies.co.uk

Thursday’s inflation figures the focus for the euro this week (Mike Vaughan)

Sterling has started the week on the right track pushing market levels back close to 1.2550. This week we have a host of data from the euro zone starting with industrial production data on Wednesday (10:00) followed by the important inflation and GDP data on Thursday (10:00), this all follows the ECB monthly report at 09:00. The euro zone is still having issues with deflation and it will again bring into focus Thursdays data. Figures are forecast to fall from 0.5% to 0.4% and if as expected I would look for the Euro to fall and would expect to see GBP/EUR back above 1.26 and EUR/USD into the low 1.33s by the weekend.

Should you have Euros to sell I would be tempted to avoid Thursdays release, likewise should you be buying then it might be worth holding on until Thursday. Although a word of warning for those with an interest in GBP/EUR as the Bank of England quarterly inflation report is released at 10:30 on Wednesday.

To get more information on the currency service we provide and to see how we can save you on your foreign exchange please email Mike mgv@currencies.co.uk

Euro Exchange Rates against Sterling (Tom Holian)

The Euro has hit over a one month high vs Sterling as the UK trade deficit showed a widening on Friday.

If you have been reading some of my previous articles I have suggested that it is only a matter of time before GBPEUR rates begin to fall. One of the main reasons is that with Sterling so high it negatively impacts upon British exports and that takes a bit of time to filter through to data releases.

On Wednesday we have the release of UK unemployment data which last month hit its best level in 8 years. The previous month saw a fall to 6.5% and I think with UK manufacturing figures falling last Friday and the trade deficit showing problems I think we could actually see an increase in unemployment this week causing Sterling to fall against the Euro.

Tuesday morning sees the release of the ZEW survey which is a business survey concentrating on economic sentiment. It is difficult to predict how this might come out as the sanctions with Russia are likely to have some sort of impact and we could see the Euro encounter a volatile period against the Pound shortly after the release.

Thursday is likely to be the biggest day of the week as the ECB Monthly Report is published as well as Eurozone GDP data.

GDP last quarter was just 0.1% so anything higher could see the Euro strengthen and anything lower could see huge falls for the single currency.

If you are concerned about any of the week’s data announcements and would like to save money when buying currency then contact me directly for a free quote Tom Holian teh@currencies.co.uk