Homepage » News » EUR/GBP » Euro to British Pound (EUR/GBP) Exchange Rate Forecast to Decline on UK Mortgage Approvals

Euro to British Pound (EUR/GBP) Exchange Rate Forecast to Decline on UK Mortgage Approvals

Euro (EUR) Exchange Rate Forecast to Decline after PMIs Fail to Meet with Estimates

The Euro to Pound Sterling (EUR/GBP) exchange rate softened by around -0.2% on Friday afternoon.

The shared currency softened versus its major peers on Friday morning in response to disappointing domestic data. The French Manufacturing, Services and Composite PMIs all failed to meet with median market forecasts. Similarly, German Manufacturing, Services and Composite PMIs failed to hit expected growth. The disappointing data out of France and Germany caused the Eurozone Manufacturing, Services and Composite PMI’s to fall below the respective market consensuses.

Commenting on the flash Eurozone Composite PMI data, Chris Williamson, Chief Economist at Markit said; ‘Eurozone economic growth lost only slight momentum in July amid the rollercoaster events of the Greek debt crisis during the month. The rate of expansion remained reassuringly robust to suggest that it was by-and-large ‘business as usual’ for the region as a whole. The PMI suggests the Eurozone continues to enjoy its strongest performance in terms of both economic growth and job creation seen over the past four years. The survey indicates that the economy grew 0.4% in the second quarter and sustained this steady pace at the start of the third quarter.’

The Euro to Pound Sterling (EUR/GBP) exchange rate is currently trending in the region of 0.7068.

Pound Sterling (GBP) Exchange Rate Forecast to Edge Higher after UK Mortgage Data Betters Market Consensus

After declining on Thursday in response to less-than-ideal British retail sales, the Pound recovered its losses on Friday morning. This is mainly due to better-than-expected BBA Loans for House Purchase in June, which came in at 44488; bettering the median market forecast of 43300. Many analysts predict Sterling bullishness ahead as the Bank of England (BoE) looks to tighten monetary policy before the turn of the year.

Of the BBA Loans for House Purchase result, Ryan Littlestone of ForexLive stated; ‘Highest since March for the headline number. If wages keep rising then we’re going to see increased activity in the housing market and these lending numbers. Hopefully (big emphasis on hopefully) last year’s BOE mortgage rules will keep a lid on people overextending themselves.’

The Euro to Pound Sterling (EUR/GBP) exchange rate dropped to a low of 0.7052 today.

Euro to Pound Sterling (EUR/GBP) Exchange Rate Forecast to Hold Losses on Policy Divergence

Given that many analysts predict that the shared currency will decline as investor focus shifts from Greece to monetary policy and with an absence of domestic data to provoke changes, the Euro to Pound Sterling (EUR/GBP) exchange rate is likely to hold losses for the remainder of Friday’s European session.

Over the course of the coming week, the EUR/GBP exchange rate is forecast to decline irrespective of developments in Greece as the Bank of England (BoE) and Federal Reserve flirt with tighter policies and the European Central Bank (ECB) maintains its full course of quantitative easing.

The Euro to Pound Sterling (EUR/GBP) exchange rate climbed to a high of 0.7093.