The EURGBP exchange rate was trading 0.20% higher on Tuesday as the euro continues to see a sharp rebound from the recent lows. The European Central Bank will meet on Thursday and the pound has retail sales figures released on Friday to drive the pair.
The EUR to GBP trades at 0.8645 and already has the May highs in its sights at 0.8700.
SAP to invest 250m euro in UK, grocer criticizes food supply
SAP has announced that it will invest €250m in the UK, over five years. The deal includes the launch of a cloud service, to be based in the UK, with two new offices in Manchester and London.
Scott Russell, executive board member at SAP, said: “The UK is a critically strategic market for SAP, and with its highly successful vaccine roll-out, it has an increasingly positive outlook for the years ahead. We are incredibly excited about this commitment, which will bring new services to market for our customers, greater support for social enterprises, as well as an even better working environment for our colleagues and new talent.”
In retailing news, a Scottish greengrocer has launched a tirade at Boris Johnson over the UK’s EU dependency. James Welby of Tattie Shaw’s in Edinburgh said:
“It is probably a combination of Brexit and Covid but the produce is taking much longer to get here than it used to and it often isn’t class one when it arrives.”
Mr Welby added: “It is just not realistic to say we should replace it with British produce. The whole way Britain’s food chain is set up is to get the stuff from Europe. It is cheaper to grow it there – they get two harvests a year, the weather is more reliable, they can get the labour. There is not much farming of that kind left in Scotland or the UK.”
The virus led to the loss of many truck driver roles and these types of supply chain issues have been behind some of the rise in inflation lately.
ECB meeting on Thursday will be focus
The UK will see data on Friday in the form of retail sales figures, but the headline event will be the ECB meeting on Thursday. The bank will keep rates locked at zero, but the recent strategic policy review could see some dialogue changes around the bank’s policy and bond program.
The bank shifted the inflation target from “below, but close to 2%’ to ‘2%” and ECB Chief Christine Lagarde said that 2% “was not a ceiling”. These comments could be an attempt to bat away any imminent tapering talk due to rising inflation. The bank said they would tolerate temporary moves above target and that gives them leeway to stay dovish despite rising prices in the future.
The EURGBP exchange rate trades at 0.8645 and will look to the ECB for further gains to the May highs.