Euro Pound (EUR/GBP) Exchange Rate Falls as MPs Seize Control of Brexit
The Euro Pound (EUR/GBP) exchange rate continued to slide this afternoon, and the pairing is currently trading at an inter-bank rate of £0.8534.
Monday evening provided the Prime Minister with yet another blow as MPs voted in favour of seizing control of the parliamentary timetable from the government.
This saw thirty Conservative MPs rebel against the government, including three Ministers – Alistair Burt, Richard Harrington and Steve Brine – who subsequently resigned.
Harrington accused the government of ‘playing roulette with the lives and livelihoods’ of the British public.
Meanwhile, commenting on the options left for the House of Commons, as a second referendum has already been rejected, Health Secretary Matt Hancock said:
‘The idea of having a no-deal […] The Commons is absolutely clear it won’t allow and will legislate against it if necessary.
‘That means that the options are narrowing.’
Euro (EUR) Slides as German Consumer Confidence Falls Further than Expected
Data released this morning revealed that April’s GfK German consumer confidence slipped, which likely added to fears that the Eurozone’s economy is slowing.
Consumer confidence fell further than forecast from the downwardly revised figure of 10.7 to 10.4.
Data has suggested that Germany’s economy has been struggling for several months, and commenting on this morning’s data, GfK researcher Rolf Buerkl said:
‘Whilst consumers are certainly not assuming that Germany will fall into a recession this year, they do see a noticeable cooling off of economic activity.
‘[…] The lack of decisiveness regarding the nature and date of the UK’s exit from the EU, as well as the growing trade conflict between the EU and USA are clearly creating ever more uncertainty among consumers. Barriers to trade, such as increases in customs duties, are currently creating a burden for German exports.’
The Eurozone was dealt a further blow when data revealed France’s industrial confidence slipped to its lowest level in close to two-and-a-half years.
Euro Pound Outlook: Will the EUR/GBP Exchange Rate Slide on a Dovish Draghi?
Looking ahead to tomorrow, it is likely the Euro (EUR) could slide against Sterling (GBP) following a speech from the European Central Bank (ECB) President Mario Draghi.
If Draghi’s tone is noticeably dovish and he expresses fears that the Eurozone economy is slowing, it could dampen sentiment in the single currency.
Due to an absence of UK economic data releases, it is likely Brexit will continue to stay in focus as one of the main catalysts for movement of Sterling.
Tomorrow MPs are due to vote on alternatives to the Prime Minister’s Brexit withdrawal agreement.
If MPs vote to for options that would result in a soft Brexit, it could cause the Euro Pound (EUR/GBP) exchange rate to slide.