The euro to pound exchange rate has remained range bound for the past few weeks now, and this morning has been no different with the pair continuing to trade between 1.1400 to 1.1500.
Currency markets appear to have consolidated after an extremely volatile March and early April, as the effects of the lockdown due to the Coronavirus have been digested by the markets, hence the lack of movement for many major currency pairs. There’s a chance we could see some movement for EUR exchange rates later today as the European Central Bank (ECB) will announce its latest Interest Rate Decision and there will also be a monetary policy statement afterwards that could impact sentiment towards the euro.
Economic data releases aside though it appears to be government guidance on reducing the lockdown measures that holds the potential for market movement, so I think those of our readers with currency requirements should pay attention to COVID-19 updates from political leaders for this reason.
When Will Attention Turn Back to Brexit Negotiations?
Another topic of discussion that could impact the EURGBP interbank exchange rate is the path to Brexit. This week foreign minister, Dominic Raab reiterated the government’s stance that the UK and the EU would stick to the transitional deadline of December which is concerning some with the markets. As the UK and EU negotiators have had less time to negotiate due to the lockdown, there are fears that the UK will depart the EU without enough trade deals in place which could impact the UK economy negatively. There are hopes of progress from both sides by June so I think this could also influence the EURGBP rate if insufficient progress has been made.
Yesterday we saw that the US economy slowed dramatically in the first quarter of this year, as it had its biggest drop since the recession in 2009. Later today the Eurozone Gross Domestic Product data will be released so if there is a significant drop for the trading bloc there could also be market movement.
Get in touch to discuss the results of today’s economic data release, or to discuss an upcoming currency exchange involving sterling or the euro. I’ll be happy to get in touch personally and discuss your enquiry.