The Euro to Pound Sterling (EUR/GBP) exchange rate was trading lower on Tuesday ahead of highly influential German Unemployment Rate and Unemployment Change figures.
Earlier… The Euro to Pound Sterling (EUR/GBP) exchange rate began trending lower in Monday’s European trading after favourable UK data and ahead of German inflation figures.
Furthermore, Greece’s lack of a long-term austerity deal also weighed on the Euro exchange rate as investors priced in the possibility of a Grexit.
A senior Eurozone official stated: ‘Greece did not submit a reform list on Friday. They just showed some ideas over the weekend. The discussions from Friday to Sunday were meant to help the Greeks prepare a list for tomorrow… We still look forward to receiving something on Monday.’
Greek Talks Forecast to Impact EUR/GBP Exchange Rate Trading
The progress in Greece’s austerity negotiations has been slow to say the least, leaving plenty of opportunity for investor speculation on the possibility of a Greek exit from the Eurozone.
Greek talks are scheduled to begin at 12pm today and could impact the Pound Sterling to Euro (GBP/EUR) exchange rate significantly if any developments are made.
Additionally, the result of today’s German Consumer Price Index (CPI) could be a major cause for GBP/EUR movement with economists forecasting a rise of from 0.1% to 0.3% in March on the year.
Any fall out of line with forecasts could see the Euro to Pound Sterling (EUR/GBP) exchange rate swing.
UPDATE: Annual German inflation data printed in line with forecasts while the monthly March reading rose buy 0.5% rather than the 0.4% expected.
The EUR/GBP currency pair sank lower last week to the 0.73 region, where it’s remained pretty consistently since; however, an upbeat German ecostat could help it to break higher.
Meanwhile, the Pound Sterling was offered some support when UK Mortgage Approvals rose to a six-month high in February.
The ecostat hit 61,760 rather than the forecast 61,500 after January’s 60,707—an upbeat development amid speculation of a UK slowdown.
Economist Howard Archer had predicted an increase in mortgage growth, saying: ‘We expect the Bank of England to report on Monday that mortgage approvals for house purchases rose modestly for a third month running in February, after falling for five successive months to be at a 17-month low in November.’
‘The data will show that there was a significant improvement in real disposable income.’
Furthermore, the data suggests that homebuyers are showing fewer nerves than perhaps were expected on the prospect of a political shakeup in the May general election.
Additionally, the Bank of England (BoE) has announced it will be conducting another stress test for UK banks to see if they’d be able to withstand another shock like the global financial crisis of 2008.
Cooperative Bank is not included in BoE stress tests this year as too small, seven others financial firms to be tested
— Jill Treanor (@jilltreanor) March 30, 2015
Euro to Pound Sterling (EUR/GBP) Exchange Rate Forecast
The Euro to Pound Sterling (EUR/GBP) exchange rate will have plenty of opportunity to move today with the release of Eurozone Economic, Services, Industrial and Consumer Confidence indexes.
Again, upbeat data from the 19-nation currency bloc could seriously bolster the Euro exchange rate and send it higher; perhaps combined with upbeat German inflation the EUR/GBP exchange rate could break into the 0.74 region.
The Euro to Pound Sterling (EUR/GBP) exchange rate is trading at 0.7260. The Pound Sterling to Euro (GBP/EUR) exchange rate is trending in the region of 1.3787.