Due to a lack of major economic data releases on Monday the Euro is little moved against the Pound.
The Euro initially spent Tuesday’s session higher against the Pound but as it went on the UK currency turned the tables and rallied back above the 1.20 range as investors increased their expectations that the Bank of England will announce adjustments to its forward guidance policy at its quarterly inflation Report tomorrow.
The Euro was higher against the UK currency early in the session after speculation arose that Vodafone Group Plc would bid around €8 billion for a Spanish based rival, a move that increased optimism for the single currency.
Sterling rallied however after a report released by the British Retail Consortium showed that retail sales growth in the country leapt by 3.9% on a year by year basis. The figure added to the 0.4% rise recorded in December and smashed economist forecasts for a rise of 0.8%.
The report increased optimism over the state of the UK economic recovery and increased speculation that Bank of England Governor Mark Carney will announce adjustments to the BoE’s forward guidance policy.
Tuesday’s session has been devoid of any data out of the Eurozone so the single currency has been at the mercy of international factors. The Euro is also coming under some pressure ahead of the release of Wednesday’s Eurozone Industrial Production data for December which is forecast to show a decline from the previous month, casting doubt on the strength of a Eurozone economic recovery.
Attention will also be focused on a speech due to be held by European Central Bank President Mario Draghi. Economists will be looking out to see if he comments on deflation risks to the currency bloc.
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,1.3640 ,
Euro,, Pound Sterling,0.8294 ,
Euro,,Canadian Dollar,1.5079 ,
Euro,,Australian Dollar,1.5125 ,