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Euro to GBP Exchange Rate drops further after ECB press conference

Euros

The Euro was trading softer against the Pound on Wednesday as data releases from the Eurozone’s top two economies disappointed investors and took some of the shine off of yesterday’s positive PMI reports.

A report published by the German economy ministry showed that month-on-month factory orders in the Eurozone’s largest economy plummeted in March due to a weakening in demand for consumer and capital goods from abroad and domestically.

According to the data, industrial orders slumped by 2.8% in March, the sharpest fall recorded since November 2012. The figure was also a lot worse-than-economist forecasts for a slight rise to 0.3%. Analyst were blaming the fall on a weaker Chinese economy and tensions between the West and Russia over Ukraine.

“There are risks that could slow down growth, but the major positive factor from abroad is that the Euro area is recovering, and the effect for the German industry is bigger than negative influence from China or Russia,” said an economist from DZ Bank.

Data out of France put further pressure upon the Euro. The Eurozone’s second largest economy saw its trade balance deficit widen to -€4.9 billion in March.

The figure was worse than the forecast -€4.0 billion forecast. Month by month industrial production also fell more-than-expected with a contraction of -0.7% occurring in March and year-on-year production fell by -0.2%. Both figures were worse-than-expected.

The Euro to GBP exchange rate is currently trading around 0.8200 – 07/05/14

Investors are also looking ahead to Thursdays European Central Bank policy meeting. The Bank is expected to leave its benchmark interest rate on hold at the record-low level of 0.25%.

Sterling meanwhile found support from a report which showed that the number of new cars sold in the UK climbed by 8% year-on-year.

The society for motor manufacturers and traders reported that sales rose to 176,280 in April. The data marks a 26th consecutive month of growth.

As a result of the data the SMMT raised its forecast for next year. It now expects sales to rise to 2.4 million in 2014.

Euro to GBP update – 08/05/14

Sterling pushed beyond the 1.22 level against the Euro after the ECB refrained from introducing new stimulus measures.

At the press conference that followed the rate decision announcement, ECB President Mario Draghi caused the single currency to tumble against its peers after he suggested that if inflation remains weak the Bank was comfortable with introducing new stimulus measures at next month’s policy meeting.

As a result the Euro fell to a session low against the Pound and gave up its earlier gains against the US Dollar.

The GBP/EUR Exchange Rate climbed to 1.2207 and the USD/EUR Exchange Rate climbed to 0.7201

Euro (EUR) Exchange Rates

[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Euro,,US Dollar,1.3913 ,
Euro,,British Pound,0.8200 ,
Euro,,Australian Dollar,1.4906 ,
Euro,,Canadian Dollar,1.5144 ,
[/table]

As of 10:45 am GMT