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Euro to Pound Sterling (EUR/GBP) Exchange Rate Forecast: UK Interest Rate Rise Chances Improve Today as Nationwide House Prices Meet Predictions

Euro Exchange Rates Today

EUR/GBP Exchange Rate Remains Static as UK Housing Prices Hit Target Today

Nationwide House Prices for the UK came in as expected this morning, seeing a slight climb from the previous figure of 3.3% to reach the forecast 3.5%. Movement for the Pound has thus far been fairly minimal and the EUR/GBP pairing is currently trending narrowly in the range of 0.7026.


Turmoil in the reopened Greek stock market weighs down on the Euro (EUR) this morning as Manufacturing PMI reports show growth for both the Eurozone and UK.

EUR/GBP Exchange Rate Shored Up before Weekend on UK Consumer Confidence Disappointment and German Retail Sales Growth

A lower-the-expected UK Consumer Confidence Survey caused the bullish run of the Pound (GBP) to waver in the early hours of Friday, as the index was reported to be at 4 rather than the forecast 5. Already a decline on the previous month’s figure, this shortfall signalled a distinct decrease in optimism from UK citizens. However, given the month of uncertainty that July had been this was not altogether a serious blow for Sterling, which soon regained its lost ground to prevent the EUR/GBP pairing rising further.

Positive Retail Sales data was also released from Germany, showing a highly optimistic year-on-year rise to 5.1% from the previous figure of -1.0%. Bolstering the upwards trend of the EUR/GBP exchange rate, the pairing only strengthened further as the core inflation data for the Eurozone unexpectedly increased from 0.8% to 1.0%. Indicating economic recovery almost across the board this all shored the Euro (EUR) up to hit a daily high against the Pound of 0.7092 in the early afternoon.

Stock Losses in Athens Today Outweighed by Positive Eurozone PMI Reports, EUR/GBP Margin Narrows

Today’s resumption of trading in the Athens stock market was initially turbulent, as expected, with falls of as much as 30% observed in some quarters. While not dealing a significant blow against the common currency, the Euro has seen declines against the majors, returning to a downwards movement against the Pound this morning as the EUR/GBP pairing slipped to 0.7016. However, this trend was quickly countered by better-than-expected manufacturing PMIs for both Germany and the Eurozone as a whole and the exchange rate soon rose back to 0.7026.

Equally coming in above-target, the UK’s manufacturing PMI indicated continuing improvement for the nation’s economy. Potentially the precursor to an interest rate rise from the Bank of England (BoE) Monetary Policy Committee (MPC), who are due to gather later this week, the Pound should now start seeing the return of its hawkish run this week. In the event of a hike, or indications that MPC members have started to vote for one, the Euro will surely continue to lose ground against its strengthening rival.

Euro to Pound Sterling (EUR/GBP) Exchange Rate Forecast: Eurozone Retail Sales Hold Potential for Further Common Currency Rally as Greek Uncertainty Remains

Tomorrow’s Nationwide House Prices could prompt further gains for the Pound while the Euro must wait on the Eurozone Retail Sales data, set to be reported on Wednesday. The situation in Greece is likely to continue dominating the fortunes of the common currency however, especially as the date for the Hellenic nation’s next repayment to the European Central Bank (ECB) is 20th August. Should the agreement of a third bailout from creditors not be completed by then, the Eurozone as a whole is likely to experience the negative consequences.

Continuing fears of political instability as Prime Minister Alexis Tsipras wrangles to remain in control of the dissidents within his own party will likewise continue to shadow the common currency for the near future. The situation in Greece remains far from resolved and anything but stable, which cannot bode well for investors who might otherwise be drawn in to boost the Euro.

Current EUR, GBP Exchange Rates

At time of writing, EUR/GBP is in the range of 0.7021 while GBP/EUR is trending upwards around 1.4235.