As the Eurozone economy attempts to recollect itself, the GBPEUR interbank rate has increased marginally. Interestingly, the pound to euro exchange rate showed better signs today. The pairing is currently trading near €1.161. As is the case, the market appeal for the single currency has dropped due to rising concerns over the economic health of Eurozone.
This was after the decline in the figures of German factories, which painted a less desirable picture for not only the biggest manufacturing juggernaut in Europe but also for rest of Europe.
According to the European economic data, the producer price index figure for Europe eased by -1.2%.
On the other hand, the pound edged past the single currency subsequent to the BRC Like-for-like Retail Sales number increased by 0.1% for the month of October. This is primarily due to high-profile retail stores offering hefty discounts in an effort to ramp up consumer confidence. The next month’s election is also partially responsible for this.
The long-term trends paints a bleak picture as the 12-month sales growth is not as formidable as it used to be. Euro predictions from others also corroborated this sentiment. The months that lie ahead could be tricky for Eurozone. The fourth quarter could be in for a rough start, with US-China trade deals in tow and the fate of UK regarding Brexit, downside risks are still there.
Brexit affects euro and with the incoming December election, there are newly-created uncertainties, retailers will certainly be nervous about the months that lie ahead.
Speaking of sterling, the currency stood its ground against the euro currency even though the US Services Purchasing Manager’s Index (PMI) for the month of October showed little sign to move out from the contraction territory.
Interestingly, the pound to euro exchange rate could be even higher if the factory orders in Germany continues to show signs of deterioration. This could potentially exacerbate the situation for the Eurozone economy and weigh quite heavily on the single currency itself.
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