Euro to Pound Exchange Rate Lower despite Lack of Drive in Sterling
Despite some brief surges in demand earlier in the week, the Euro to Pound Sterling (EUR/GBP) exchange rate is on track to end the week lower as investors sell the Euro (EUR) on weak Eurozone data and the US Dollar’s (USD) resurgent strength.
After opening this week at the level of 0.8654, EUR/GBP briefly jumped to a two month high of 0.8679 before slumping towards the end of the week.
At the time of writing on Friday morning, EUR/GBP is trending near a weekly low of 0.8629.
The pair has been unable to hold its ground due to continued weakness in Eurozone economic data, and no fresh signs that things will improve any time soon despite those hopes supporting the Euro earlier in the month.
Meanwhile, the Pound’s (GBP) own gains versus the Euro have been limited too amid a lack of supportive data or any optimistic Brexit developments.
Euro (EUR) Exchange Rates Continue to Tumblr as French Consumer Confidence Disappoints
Rounding off a week of disappointing Eurozone confidence data, France’s April consumer confidence report disappointed investors as well when it was published this morning.
While a hugely disappointing figure, news that the consumer confidence print had remained at 96 rather than climbing to 97 as expected left investors doubtful that Eurozone economic activity was recovering from months of slowdown.
According to the report, households were a little less concerned about the general economic situation, but were more concerned about unemployment.
It followed on from other disappointing data published over the past week, including Ifo’s German business confidence stats on Tuesday, and last week’s disappointing Eurozone PMI projections.
As well as disappointing Eurozone economic data, investors are also anxious about this weekend’s upcoming Spanish general election, and are hesitant to move much on the Euro until the results come in.
Pound (GBP) Exchange Rate Gains Limited amid Lack of Brexit Developments
Save for some decent economic data from the Confederation of British Industry (CBI), UK news has been relatively quiet this week and has given the Pound no notable reason to strengthen.
Instead, broad expectations of months-more Brexit uncertainty means that investors are hesitant to move much on Sterling, and the British currency is being driven more by strength in rivals like the Euro.
UK Parliament resumed this week, following an Easter recess. However, Parliament has not yet seen any notable developments regarding Brexit.
On top of this, the government’s cross-party Brexit negotiations are perceived as having made little real progress, deepening doubts that a compromise deal on Brexit will be reached any time soon.
Euro to Pound (EUR/GBP) Exchange Rate Investors Anticipate Major Data Next Week
After mixed movement and a lack of major drivers this week, the Euro to Pound (EUR/GBP) exchange rate could see a bigger shift in movement next week as many major ecostats from the Eurozone and the UK will be published.
Eurozone data will kick off the week, with key consumer confidence stats for April due on Monday, followed by a slew of ecostats on Tuesday.
Tuesday’s key data includes German consumer confidence, unemployment and inflation data, as well as French growth and inflation data, and the Eurozone’s overall unemployment and growth rate data.
The Pound is still more likely to be influenced by potential Brexit developments than UK data next week, but some PMI stats due towards the end of the week could prove influential as well. The Eurozone’s April PMIs will also be published.
Lastly, the Bank of England (BoE) will hold its May policy decision on Thursday, but the bank is unlikely to cause any big movements in the Euro to Pound (EUR/GBP) exchange rate unless its tone is highly surprising.