Euro Rate Forecast

Currency experts forecast on the Euro

Euro Forecast – The Euro Looks Set for A Tough Few Months

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In today’s euro forecast, we look at what’s likely to affect the euro in the coming weeks. The outlook for the euro remains dovish, because there are concerns over the growth forecasts for the Eurozone.

Last week, the Eurozone saw its economic growth for 2019 revised down from 1.9% to 1.3%. What is possibly even more alarming is that Germany, the powerhouse of the Eurozone bloc, slashed its own growth forecast down to 1.1% from 1.8%.

Over recent years, Germany has always managed to keep its own economy relatively healthy, even in times of economic downturn. In turn, this helps to support other flagging economies in the EU.

If Germany shows signs of any longer-term economic downturn, then it is likely to reinforce the markets concerns about the Eurozone. Ultimately then, my euro forecast is that the euro may be in for a rough ride over the coming months.

Euro predictions: Euro may weaken as Italy enters recession

It is not just Germany that faces the prospect of economic contraction. Only recently, Italy has fallen back into a recession too. Italian Gross Domestic Product (GDP), which is the key barometer for any economy, is predicted to sit at just 0.2% in 2019. This makes grim reading.

With another Eurozone linchpin, France, in the midst of political crisis, it is easier to understand why investors have started shying away from the euro.

Indeed, those clients holding the single currency may wish to consider their positions. I fear they will see their assets depreciate over the course of 2019, if the economic strangleholds mentioned manifest themselves further.

Buying euros?

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 18 years’ experience, in helping our clients achieve the very best exchange rates on any given market.

Our rates can be accessed very easily over the phone. Also, I can keep you posted with key market developments ahead of any prospective exchange you need to make.

Feel free to email me directly on mtv@currencies.co.uk to find out all the options available to you ahead of your currency transfer. I look forward to hearing from you!

Matt Vassallo

Euro Rate Prediction: Worrying Times Ahead for The Euro

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In today’s Euro rate prediction, we look at the backdrop that the Eurozone is currently experiencing its worst growth since 2014.

The Euro, although still looking good against Sterling, could be in for a rough year. Mario Draghi, the head of the European Central Bank (ECB) has tried to ease investor concerns by lauding the current impressive employment figures in the bloc.

However, there are serious concerns. Germany, the engine room of the Eurozone has just narrowly avoided recession. Also, Italy has just entered a recession.

Italy’s growth figures were down by -0.2% in the final quarter of 2018 following a -0.1% decline in the third quarter. Italy’s debt is now second only to Greece. Greece, another huge economic problem for the Eurozone, has seemingly been swept under the carpet.

How will Eurozone cope without quantitative easing?

There are ongoing trade wars which threaten the global economy. In addition, the ECB have just put an end to Quantitative Easing (QE).

QE is essentially pumping money into an economy in order to stimulate growth, The ECB had been pumping upward of €60 million per month into the bloc, in an effort to stimulate growth.

QE has always been a controversial form of monetary policy, as it amounts to a huge amount of debt and the impact can be limited. With growth being the desired result, it seems the latest QE plan has failed.

Current growth data in the bloc shows the lowest growth figures since 2014. It will be interesting to see how the Eurozone copes without QE, which ended in December.

Pound v Euro forecast: Sterling remains fragile

If it were not for the lack of clarity surrounding Brexit, I think we would be seeing the Pound making gains against the Euro. Unfortunately though, Sterling remains fragile.

UK Prime Minister Theresa May is in a very weak position to negotiate. Parliament has stated that it is willing to give Mrs. May’s deal the O.K, provided she gets certain concessions. However, Mrs. May still has to gain these concessions from Brussels, which will be no easy task.

It is important to remember that Mrs. May decided to postpone the first vote in Parliament on her deal. This is because it was common knowledge that MPs were unhappy with the deal in its current form.

Mrs. May then went back to Brussels and was stonewalled. European Commission President, Jean Claude Junker, has stated on several occasions that there will be no changes to the current deal. Essentially, it is take it or leave it.

Best time to buy euros?

The reason for Sterling’s recent spike was due to the dropping probability of a “No Deal” scenario. Morgan Stanley give less than a 5% chance that a “No Deal” situation will occur. “No Deal” is May’s only form of ammunition. With this scenario now less likely than in December, she stands less of a chance of gaining the concessions required.

Many are of the opinion that we may only get a deal at the 11th hour. This is a risky business, considering these are the most important negotiations for the UK in over 50 years.

The other option is an extension while terms are hammered out. An extension could well be beneficial to the Pound. This is because the extended time period would help get deals in place, and take the pressure off getting something in place by 29th March.

Sterling will remain fragile until we get some form of clarity on Brexit.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker when the market is currently so hard to predict. If you let me know the details of your trade I will endeavour to produce a free trading strategy to suit your individual needs.

Have faith knowing you will be dealing with a brokerage in business for over 18 years, Foreign Currency Direct Plc. We are a “no risk” entity as we do not speculate on the market and we are registered with the FCA.

If you have a currency provider, take a minute to send over the rates they offer and I am confident I can demonstrate a significant saving. I can be contacted at dcj@currencies.co.uk.

Daniel Johnson

Euro Forecast: How will the Euro perform for the rest of January?

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The Euro has been weaker during a volatile week for many currencies, in particular the pound which has pushed and pulled the Euro. Investors have been keeping a close on events in Europe and the United Kingdom, to monitor developments. The Euro has been slightly weaker as the currency markets have concern over political and economic concerns in the Eurozone too.

Most importantly, investors are concerned over the measures to withdraw economic stimulus by the ECB, European Central Bank in December. This had seen the Euro stronger but there was a feeling the policy might hit some speed bumps in the year ahead and cause the Euro to weaken. Today we have the latest Inflation data which will be keenly watched for investors to assess the latest performance of the Eurozone economy. Investors are concerned that we might see the Euro begin to weaken if the economic data does not match the expectations we have seen set by the Eurozone’s central  bank.

Political concerns are also important as the currency markets have to price in the possibility of future deterioration of Macron’s position in France. If  Macron continues to remain unpopular we might well find confidence slips further which would only see the Euro weaker. Investors are concerned that the direction of European politics could set the Eurozone on course for more populist, anti-EU parties which might ultimately seek its break-up. This would not bode well for the Euro currency and should be a future concern for any clients holding Euros.

Overall, the Euro is holding firm and remains at strong historical levels against many currencies. This is largely because of the good progress showed by the economy in recent years and could well continue. Investors will however continue to require proof this is ongoing and the political tensions in France, and worsening economic data from Germany are all contributing to a much more mixed picture that could ultimately see the currency weaker longer term.

The UK’s political situation is also nerving investors and the recent events in the UK which have seen sterling higher, have pushed GBPEUR levels back over 1.13. This might well prove short-lived with many commentators predicting the pound will still be in for tough times ahead.

If you have a currency transfer to buy or sell then it is well worth checking in to make sure you are fully up to date with this market and all the factors to move your rate. Please do feel free to contact me Jonathan Watson directly on jmw@currencies.co.uk, to learn more.

Jonathan Watson

Brexit Deal could be agreed imminently (Daniel Johnson)

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 Brexit – Are we on the cusp of a deal?

GBP/EUR remains dominated by Brexit developments. 1.15 has been a resistance point for 18 months and seems to be still holding despite yesterday’s positive news. The reason for the spike in pound value is due to the speculation that a Brexit deal could be imminent. There is a cabinet meeting at 2pm where Theresa May is expected to outline a draft agreement for Brexit, If approved without any resignations there is the distinct possibility of an EU summit late in November.(23rd-25th is rumoured)

The view is that this will result in a formal deal between Westminster and Brussels. If this does occur expect Sterling to rally.

Do not think a deal  is now a foregone conclusion, the deal is far from agreed and it is also important to remember that the deal will also have to be voted through by the cabinet in December/January which will be no easy task. With so much in house fighting and Boris’ thinly veiled ruse to oust Theresa May this could well be a stumbling point.

The market continues to sit around 1.15 despite this news, the markets don’t lie and investors are not convinced the deal is done. Every time 1.15 is breached the market retracts. If you have a requirement buying Euros you are currently at the peak of the market. I would consider doing a tranche of my trade at current levels for safety. Euro sellers trade now. Pre-Brexit GBP/EUR was 1.42, selling at 1.15 is still well below the historical average. I think weighing up risk vs reward I would take advantage of current levels.

If you have a currency requirement I will be happy to assist. It is crucial to be in touch with an experienced broker when the market is currently so hard to predict. If you let me know the details of your trade I will endeavour to produce a free trading strategy to suit your individual needs. Have faith knowing you will be dealing with a brokerage in business for over 16yrs, Foreign Currency Direct Plc. We are a no risk entity as we do not speculate on the market and we are registered with the FCA. If you have a currency provider take a minute to send over the rates they offer and I am confident I can demonstrate a significant saving. I can be contacted at dcj@currencies.co.uk . (Daniel Johnson) Thank you for reading.

 

 

 

 

Daniel Johnson

Important week for the Euro: Will the Euro weaken further?

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Italy budget deadline looms

Italy is to give its response to the EU’s rejection of its budget proposals this week with a deadline set for Tuesday. Rome is being requested to revise its current plan to formulate a budget that is more in line with what the EU believe is within the guidelines. The Euro may well weaken further on this news as Rome are already indicating that the deadline will not be met and that they plan to stick firm to the proposals.

In the bond market there are being large reported increases in the amount of bets against Italian bonds, indicating there could further strain ahead for the Euro. A bond is a promise to pay back and the cost for the Italian government to borrow money to finance itself has been rising steadily. There is an expectation this will only continue further and tomorrow is a crucial time to see the extent to which this will occur.

The Euro could very easily lose significant value in the coming weeks as investors remain fearful over the possible loss of confidence in the region following investor concerns over Italy’s ability to repay its debts. Clients with a position buying or selling the Euro might wish to take stock of what could now be a very turbulent period ahead on the Euro.

Strong to weak

The Euro had remained strong in recent years as investors confidence over the possibility of a debt crisis began to fade, the stimulus program by the ECB, European Central Bank, had really helped to eradicate the stagnation in both growth and Unemployment that had plagued confidence in the region.

With political concerns rising with the departure of Angela Merkel, the ‘rock’ of European politics and stability in the Eurozone, could the Euro now be setting itself on a path to future weakness?

What is clear is that many of the problems and troubles previously alarming investors over debt levels and the ability of some countries to repay their debts, never went away. There is a concern that those problems are simply being shored up for another day.

If you have a position buying or selling the Euro, this could be a very important week ahead. If you wish to understand better what is likely to happen, or run through and discuss the all of the options available to maximise your exchange rate, then please do feel free to get in touch to discuss this further.

Thank you for reading and I look forward to hearing from you.

Jonny Watson

jmw@currencies.co.uk

Jonathan Watson

EUR Forecast – Brexit Deal and Political Unrest Could cause Euro to Weaken (Matthew Vassallo)

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Today sees the start of the much-anticipated EU Summit, with all eyes firmly fixed on Brussels.

Will the UK & EU finally be able to iron the remaining issues, predominantly contention over the Irish border and any prospective backstop agreement, and bring an end to the on-going Brexit saga?

The EUR itself found some support over the weekend, following mixed reports over whether a Brexit deal was imminent. This caused a sell-off of GBP positions, with the EUR moving back towards 1.13 at its high.

If it had not been for the unexpected political result in Germany, where Angela Merkel’s sister party the CSU lost control of the Bavarian state, then we could have seen the EUR move back under that threshold.

As of today, there is still no final resolution to discussions and reports yesterday indicated that it is getting less likely that a deal will eb reached by the end of the summit.

The Pound has also come under some pressure following some poor UK inflation figures this morning, news that has inadvertently boosted the EUR value.

Despite the single currency performing better this week, the political instability in Germany along with concerning economic events in Italy, are unlikely to significantly boost investor confidence in the Euro.

Whilst Brexit sentiment is still likely to drive the markets perception and GBP/EUR value for the most part, those clients holding EUR may wish to take advantage of this week’s improvements and avoid the potential outcome of a Brexit deal being reached.

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.

Feel free to email me directly on mtv@currencies.co.uk to find out all the options available to you ahead of your currency transfer.

Matt Vassallo

Economic data and a speech from BoE governor likley to drive GBP/EUR today

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Politicians in the UK return to work today as the summer recess period is now over. The US and Canadian markets are once again open also after yesterday’s labour day bank holiday so the markets should be firing on all cylinders today.

Yesterday the Pound was sold off against all major currencies, and fell as low as the 1.1060’s after a disappointing data release yesterday morning. Manufacturing PMI was released for the month of August. The figure measures business conditions in the sector and the figure released demonstrated a drop from the previous months figure. A higher reading was expected and this has resulted in a weaker Pound, and should this trend continue I wouldn’t be surprised to see GBP/EUR fall below 1.10 once again.

Later this morning there will be a PMI reading for the Construction sector, and another slight drop on the previous months figure is expected to be released. Another drop from expectations would likely apply increased pressure on Sterling, especially in the current climate.

In the afternoon there will be a speech from the governor of the Bank of England, Mark Carney. He will be alongside other key members of the BoE and he will appear before lawmakers to discuss the August Inflation Report. His term at the Bank is likely to be bought up as there have been rumours that he will extend his term, although these rumours were squashed by a spokesperson yesterday. There could be movement for GBP exchange rates because of this topic so it’s worth being aware of if you’re planning a currency exchange.

Do feel free to get in touch if you wish to be updated in the event of a major market movement.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Joseph W

Will today’s ECB meeting cause GBP/EUR to break out of its current trend?

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Much of the build up to today’s meeting is yet to result in movement for the pair, although once the meeting begins this afternoon I think there’s potential for price fluctuations for the GBP to EUR pair.

There was a slight uptick in the Euros value last week when European Central Bank member Praet hinted a major announcement during today’s meeting. The widely expected that there won’t be an interest rate change by the ECB this year, and I wouldn’t expect to see the ECB announce that there will be further purchasing of assets to aid the economy. This leaves open the possibility of a cutting back to its current APP (Asset Purchasing Programme) and if this is announced I’m expecting to see a boost to the Euros value.

This could push the pair outside of their current trend which has been between 1.13 to 1.15 for some time now.

Due to these hopes I also think that if there is no announcement and the markets are disappointed, we could see a Euro sell-off. It’s for this reason that some of our clients may choose to spread the risk over the announcement if they’re planning on making a large transfer between GBP/EUR.

If you would like to be notified in the event of a major move for the GBP/EUR pair, do feel free to register your interest with me.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Joseph W

EUR Forecast – Political Events in Italy and Spain a Major Concern (Matthew Vassallo)

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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.

Feel free to email me directly on mtv@currencies.co.uk to find out all the options available to you ahead of your currency transfer.

 

Matt Vassallo

UK growth figures released later this morning could impact GBP/EUR exchange rates (Joseph Wright)

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With one year to go before the Brexit officially takes place, the countdown begins with financial markets looking closely into the health of the UK economy.

Later this morning at 9.30am we will be given an idea of how the economy is fairing as UK GDP figures will be released. These figures will show us how much the UK economy grew during the last quarter of 2017, and the expectation is for 0.4% growth.

As markets are expecting to see this figure we can expect to see GBP exchange rates fluctuate if the figure released deviates from 0.4%, with rises likely if it’s greater and Sterling falls if it’s lower.

The Pound’s value has seen a boost in the last week after it emerged that the Brexit transitional deal has been agreed, which was an issue weighing down the Pound previously. Now that this has been agreed and a softer Brexit is likely to take place, I think that economic data releases will begin to carry weight when it comes to the Pound’s market movements.

The next key data release is next Tuesday, as Manufacturing data will be released and provide us with an update regarding the heath of this industry within the UK. If you have a currency exchange to make and would like to plan around this event, do feel free to get in touch as I’ll be happy to offer my own opinions on the market.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Joseph W

Pound climbs on hopes of a rate hike in May, how could this impact GBP/EUR moving forward? (Joseph Wright)

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The Pound jumped to its highest level against the Euro since early June last year during today’s trading session.

The rate went comfortably above 1.15 at it’s highest point today but it’s since dropped off back into the mid 1.14’s, which isn’t unusual to see when the rates jump to new high’s as profit taking usual puts pressure on the surging rate.

Aside from the positive news for the UK earlier this week when it emerged that the transitional Brexit deal has been arranged, the Pound has been boosted further today after the was shock result in the Bank of England’s voting members regarding their views on the monetary policy for the UK.

Markets had been expecting all 9 voting members of the BoE to vote in favour of keeping rates on hold at the moment, but 2 members shocked financial markets and voted in favour of hiking the rates at the moment. This has boosted hopes of a rate hike in May which is why the Pound saw a boost.

The comments after the vote were quite cautious as it was stated that the hikes would be gradual and limited which put a bit of pressure on Sterling, but personally i think that if the hike in May happens we’re likely to see a stronger Pound in the latter half of the year.

With the EU summit taking place in Brussels over the next few days I think those following the rates should be weary in case of further Brexit revelations.

If you have a large currency exchange to carry out in the coming days, weeks or months then you are more than welcome to speak with me directly as I will be more than happy to help you both with trying to time a transaction and getting you the top market rate when you do come to buy your currency. A small improvement in a rate of exchange can make a huge difference so for the sake of taking two minutes to email me you may find you save yourself hundreds if not thousands of Pounds. You can email me (Joseph Wright) on jxw@currencies.co.uk and I will endeavour to get back to you as soon as I can.

Joseph W

What will move the Euro in the next week?

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The Euro has been struggling to continue its recent performance in 2018, having performed very well against all the major currencies. Expectations for the Euro are centered around the improved political certainty stemming from Angela Merkel’s progress to another term as German Chancellor. Any worries over the Italian situation have failed to materialise and we are now looking at more economic factors on the Euro.

Mario Draghi and his team have stated they will be looking to raise interest rates longer term as it comes out of the long QE (Quantitative Easing) program that has been in place for so long. The market is now factoring in the longer term chances of Euro strength but with so much ‘good news’ in the value of the Euro already, looking for further improvements could be tricky.

The Euro is slightly softer as the market had risen so much on the comments from the ECB (European Central Bank) last week. If you need to buy Euros with pounds we are currently above 1.13 on the interbank rate. These are close to some of the best rates to buy Euros since May 2017! Overall conditions in the market are still unsettled, the next really big news will be the EU Summit next week.

GBPEUR rates could be quite volatile next week as we have a series of important UK data including the Bank of England interest rate decision. This is due on the Thursday 22nd and with the EU Summit also due that week, we could be in for a very volatile period.

If you wish to learn more about the Euro rate forecast, please speak to me Jonathan Watson by emailing jmw@currencies.co.uk.

Thank you for reading and I look forward to hearing from you.

Jonathan Watson