The Euro to Pound Sterling (EUR/GBP) and Euro to US Dollar (EUR/USD) exchange rate began Tuesday’s European session trending lower ahead of Eurozone Industrial Production, UK inflation and US Advance Retail Sales figures.
The Euro to Pound Sterling (EUR/GBP) exchange rate began Monday’s trading in a narrow range as Greek negotiations continued and hung over the common currency, while the Euro to US Dollar (EUR/USD) exchange rate softened considerably in what is scheduled to be an extremely quiet day for data.
The Euro to Pound Sterling (EUR/GBP) exchange rate may be in for some choppy trading next week with the release of several key pieces of data.
Euro to Pound Sterling (EUR/GBP) Exchange Rate Forecast
While Monday will be a quiet day for markets the world over, Tuesday will be a major day for movement. The Pound Sterling exchange rate is likely to experience major movement with the release of the UK Consumer Price Index, which could pressure the Pound lower if a further tumble in inflation occurs.
Eurozone Industrial Production figures will also be out, but are only expected to offer the Euro exchange rate moderate movement.
However, Wednesday is expected to be a fiery day for Euro exchange rate trading with the release of the German Consumer Price Index, Eurozone Trade Balance, and European Central Bank (ECB) interest rate decision.
While the ECB isn’t expected to change its interest rate after already hacking down the bank rate to 0.05%, any central bank statements could influence the Euro significantly.
Furthermore, the situation between Greece and its creditors is playing an ongoing role in influencing the Euro exchange rate, as the nation attempts to renegotiate its austerity deal. Therefore any institutions or political comments could create a severe impression on the single currency.
UK data will spice up significantly on Friday with the release of the highly anticipated UK Unemployment Rate, Jobless Claims Change and Average Weekly Earnings ecostats. Any improvement in the labour market is likely to see the Pound Sterling to Euro (GBP/EUR) exchange rate rally, while any weaker ecostats could see the Pound sink against other currency majors.
Euro to US Dollar (EUR/USD) Exchange Rate Forecast
Meanwhile, the Euro to US Dollar (EUR/USD) will also be in for a spirited few days of trading with US Advance Retail Sales out during Tuesday’s trading. March is expected to see a 1.0% upswing in sales after February’s downbeat -0.6% contraction.
Wednesday could be another big day for trading with the release of the US Federal Reserve’s Beige Book which could offer rather significant US Dollar to Euro (USD/EUR) and US Dollar to Pound Sterling (USD/GBP) exchange rate movement.
US Initial Jobless Claims, Continuing Claims, Building Permits and Housing Starts figures, plus the Philadelphia Federal Reserve manufacturing index will all be out on Thursday.
Friday will throw a cat amongst the pigeons with the release of the US Consumer Price Index. Inflation the world over is tumbling as oil prices decline considerably, therefore a drop in inflation may not cause quite as strong a response as it would in perhaps more normal circumstances, but is still likely to impact the US Dollar exchange rate.
If a significant slip in inflation were to occur, it’s possible that investors could forecast a delay in Federal Reserve interest rate hikes and therefore the ‘Greenback’ could sink against other currency peers.
US Federal Reserve statements are scattered throughout the week ahead and could cause the US Dollar to Euro (USD/EUR) and US Dollar to Pound Sterling (USD/GBP) exchange rates to swing dependent on any dovish or hawkish tones.
Tuesday is expected to see Federal Reserve Minneapolis President Narayana Kocherlakota speak, but as the chief is well known for his dovish tones, the Euro to US Dollar (EUR/USD) and Pound Sterling to US Dollar (GBP/USD) exchange rates are likely to climb on his statements.
Federal Reserve official James Bullard is scheduled for talks on Wednesday but is due to speak on the subject of financial regulation; if interest rate hikes aren’t discussed, the US Dollar to Pound Sterling (USD/GBP) and US Dollar to Euro (USD/EUR) exchange rates may be able to remain relatively stable.
On Friday, the Euro to US Dollar (EUR/USD) exchange rate was trading at 1.0582; the Euro to Pound Sterling (EUR/GBP) exchange rate was trending in the region of 0.7244.