The Euro has softened against the Pound marking a second consecutive day of losses following the release of economic data showing that British Banks increased the number of mortgage approvals in June, suggesting that the UK recovery is picking up speed.
Sterling also made gains against 11 of its 16 most traded peers ahead of the release of data on Tuesday which is expected to show that consumer price inflation in the UK stayed above the Bank of England’s target of 2%.
The rest of the week looks set to be fairly volatile for the EUR/GBP currency pair due to the plethora of data set to be released. Following Tuesday’s UK inflation data the EU and Eurozone will release their latest industrial production and German ZEW survey data.
This week also sees the release of Eurozone GDP figures, US retail sales data and on Thursday the UK’s retail sales data.
The Eurozone data in particular will be keenly watched especially the GDP figures. Speculation is rising that the data will show that the Eurozone’s record long recession has finally come to an end. The GDP figures due for release on Wednesday are expected to show that the Eurozone economy grew by 0.2% in the second quarter of 2013.
“Add it all up, and it’s a more positive picture for the global economy late this year and next,” Mark Zandi, chief economist at Moody’s Analytics, said.
“It feels like the global economy is stabilizing, and by year’s end, certainly as we move into next year, growth will be accelerating, led by the US but I also anticipate some growth out of Europe and stable growth out of the emerging world.”
Even the smallest sign of a recovery should set the Euro in a positive position for the rest of the year. If however the data comes in worse-than-expected then we can expect the single currency to weaken.
Euro (EUR) Exchange Rates
As of 15:00 pm
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3300 <
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8599
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6630 >
The Euro/ Canadian Dollar Exchange Rate is currently in the region of: 1.3712 <
