The Euro (EUR) has fallen by -0.3% against the Pound Sterling (EUR/GBP) today, while economists and investors alike have analysed the root cause of the problem – Mario Draghi’s speech.
Expectation for Bond Buying Expansion at Next ECB Policy Adjustment
With European Central Bank (ECB) President Mario Draghi effectively ruling out any policy adjustments in February, economists such as IHS’s Howard Archer have been forecasting that March could see the realisation of the quantitative easing expansion that Draghi was forecast to deliver in December.
The Euro (EUR) has risen by 0.2% against the Pound Sterling (EUR/GBP) today, which while still advantageous to the single currency nonetheless represents a loss compared to earlier, more stable movement.
Economic Ice Age Continues – ECB Freezes Rates and Predicts No Changes Anytime Soon
The Euro’s (EUR) fall from grace today can essentially be attributed to investors optimistically predicting no change for the European Central Bank’s (ECB) policy decisions of the afternoon (which happened). However, ECB President Mario Draghi’s subsequent speech in which he chose March as the possible policy shift date did nothing to maintain this optimism.
The Euro (EUR) has advanced by 0.4% against the Pound Sterling (EUR/GBP) today, with other gains being seen against all rivals except the Japanese Yen (EUR/JPY).
Potential for Euro (EUR) Rout Today if Draghi’s Tone Turns Dovish
Although the common currency (EUR) is currently on an uptrend due to investor optimism over an inactive outcome from this afternoon’s European Central Bank (ECB) policy decisions, it is entirely possible that ECB President Mario Draghi will manage to devalue the Euro massively by announcing, among other possibles, an intensification of quantitative easing.
The Euro (EUR) has declined slightly against the Pound Sterling (EUR/GBP) today, having fallen so after Sterling’s (GBP) recovery eventually came about after Mark Carney’s announcement yesterday.
Unsettling Start to the Year may be Tip of the Iceberg for Global Economies
With the World Economic Forum at Davos ongoing, opinions have been filtering out from the talks about the possibility of another financial crisis occurring this year or further in the future.
BAE Systems Chairman Sir Roger Carr has summarised the current headwinds by saying: ‘I think we’re witnessing a collision of events which has provoked an immediate sense of crisis. Commodities, China, oil prices, terrorism, geopolitical turbulence – all have landed particularly in the month of January…while things are far from perfect, we are not at the point of absolute crisis’.
The Euro to Pound Sterling (EUR/GBP) exchange rate has risen notably today, despite Sterling (GBP) being the recipient of several apparently supportive economic publications during the morning.
EUR/GBP Exchange Rate News: Euro Advances against Rivals as First 2016 ECB Decision Looms
The Euro (EUR) has risen to the occasion against the competition today, despite not actually having any supportive domestic data to have been bolstered by. Instead, it is thought that the current Euro uptrend has been brought about by investor optimism regarding tomorrow’s European Central Bank (ECB) Interest Rate Decision, the first of the New Year.
In a more concrete development, Germany’s Producer Prices for December have remained uninspiring, having fallen from -0.2% to -0.5% on the month and made what can loosely be called an ‘improvement’ from -2.5% to -2.3% on the year.
Among the many Euro gains today have been advances of 0.3% against the Pound Sterling (EUR/GBP), 0.7% against the South African Rand (EUR/ZAR) and 0.9% against the Australian Dollar (EUR/AUD). The only noticeable loss for the Euro has been by -0.6% against the Japanese Yen (EUR/JPY).
Pound Sterling (GBP) Investors Unimpressed Today by Better-than-Expected Employment Figures
The Pound Sterling (GBP) has declined against a large number of rivals today, with the likely cause being yesterday’s incredibly dovish statement from Bank of England (BoE) Governor Mark Carney that the UK interest rate would not be increasing anytime soon.
Although this morning has brought the news that the UK ILO Unemployment Rate for the three months to the end of November has fallen from 5.2% to 5.1%, as well as the development of a reduction of -4.3k cases in the Jobless Claims Change for December, the Pound has failed to capitalise on the opportunity.
Among the various GBP movements of the day have been a minor decline against the Euro (GBP/EUR); greater losses of -0.4% against the Qatari Rial (GBP/QAR) and -0.8% against the Japanese Yen (GBP/JPY) have also been seen. On the positive side, the Pound has made gains of 0.7% against the Australian Dollar (GBP/AUD) and 1.6% against the Russian Ruble (GBP/RUB).
EUR/GBP Exchange Rate Forecast: Davos Talks may Provide Only Remaining Pairing Movement Today
With the last Eurozone and UK economic publications of the day now out, it falls to the planned discussions of the World Economic Forum (WEF) in Davos to generate any further exchange rate movement.
Among the relevant scheduled talks still to come today are a 50 minute long session that intends to discuss ways to prevent shocks to global markets in the future, a speech from Germany’s President, Joachim Gauck, on the faring of his country and others in Europe when facing the current migration crisis and an afternoon forum which will also cover the refugee crisis coming out of the Middle East and Africa.
Current EUR, GBP Exchange Rates
The Euro to Pound Sterling (EUR/GBP) exchange rate was trending in the region of 0.7708 and the Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.2975 today.