The Euro Pound (EUR GBP) exchange rate was left trending in the region of 0.8650, down from the week’s best levels, following the publication of the UK’s latest employment figures.
With average earnings rising and the UK adding a greater number of positions than expected, Sterling firmed against its rivals. The Pound’s uptrend against the Euro was limited however as investors focused on the upcoming UK retail sales report. As robust consumer spending has been cited as essential if Britain is to avoid recession, a below forecast result could send Sterling trending lower.
- Euro slips to 0.86 against the Pound – Other EUR movements broadly positive
- Pound investors on edge before jobs data – Unemployment forecast to rise
- UK jobs stats imminent – Earnings result of high-importance after prior rising inflation
(Last updated 08:30 GMT)
The Euro has dipped by a small amount against the Pound (EUR GBP) as Wednesday’s trading opens, though this could all change shortly.
Sterling has been making minor gains against many of its usual peers, though this is potentially the calm before the storm for the UK currency.
Out shortly will be the UK’s July claimant count rate, as well as the June unemployment and earnings figures. Claims have been forecast to rise considerably, while for the unemployment result, BMO Global Asset Management Chief Economist Steven Bell has predicted;
‘It’s too soon really for [unemployment] to rise, but it’s been falling, falling, falling for years so less and less unemployment, it’s been a great success. And post-Brexit I’m expecting a big rise in this number one month’.
Earnings including bonuses are expected to fall in June, which could send the Pound tumbling as a result after inflation in July was shown to have risen yesterday.
(Last updated August 17th, 2016)
Pound (GBP) exchange rates have remained unsteady, as economists mull over just how big of an impact the EU Referendum result had on the UK economy.
Eurozone Economic News: Euro Exchange Rates on the Rise after Clean Sweep of Eurozone Ecostats
The Euro (EUR) strengthened on Tuesday, having been aided by the latest data out of the Eurozone.
The reports in question were the August ZEW surveys of economic sentiment for Germany and the Eurozone, as well as Germany’s ZEW current conditions figure.
In all fields, a considerable rise was recorded on the month, while a bonus boost came when June’s Eurozone trade surplus was shown to have increased considerably.
For the Euro, gains have included a minor advance against the Pound (EUR GBP), 0.5% against the South African Rand (EUR ZAR) and 0.6% against the US Dollar (EUR USD) and Indian Rupee (EUR INR).
While the Euro has more recently traded at 0.86 against the Pound, it managed a 0.87 figure at the height of the Pound’s earlier weakness.
Pound Sterling Euro (GBP EUR) Exchange Rate Slightly Improved by July Inflation Data
The Pound (GBP) managed to stage a small recovery against its peers on Tuesday, although Sterling still remains under significant pressure.
The latest domestic data out of the UK has concerned inflation in July, which rose in the base annual field but fell in both the base monthly and core yearly areas.
The results were considered high-impact, given that they provided an immediate picture of how the economy was faring after the Referendum result. However, some economists have reserved responding immediately to the news, such as Hargreaves Lansdown Senior Economist Ben Brettell, who has said;
‘In truth, the small tick upwards in the headline rate to 0.6% tells us little. The Office for National Statistics (ONS) collects data in the middle of each month, so the prices were collected just two or three weeks after the vote. It’s almost certain that the weaker Pound will cause inflation to rise more sharply in the coming months, but the effect of Sterling’s depreciation will take time to feed through fully into the figures as businesses gradually adjust to the new environment’.
The Pound has trended in a tight range against the Euro today, in addition to rising by 0.7% against the US Dollar (GBP USD) and United Arab Emirates Dirham (GBP AED).
Future EUR GBP Forecast: UK Jobs Data out Tomorrow, Sterling may Crash on Results
The next cause of Euro Pound exchange rate movement is likely to be the UK’s latest employment figures.
Crucially, the UK’s average earnings including and excluding bonuses for June are due; given that inflation has recently risen, a converse drop in wage growth could prove highly damaging to the value of the Pound.
Additionally, the UK’s claimant count change for July has been forecast to rise considerably, while the June unemployment rate has no change predicted from 4.9%.
Current EUR, GBP Exchange Rates
The Euro Pound (EUR GBP) exchange rate was trending in the region of 0.8686 and the Pound Euro (GBP EUR) exchange rate was trending in the region of 1.1514 today.