Euro to Pound Exchange Rate Rebounds Slightly following Last Week’s tumble
Due to a fresh slew of stimulus policies being introduced around the globe, the Euro to Pound Sterling (EUR/GBP) exchange rate plunged last week. Investors wound back some of the movement that had driven the pair so high earlier in March.
After opening last week at the level of 0.9231, EUR/GBP briefly climbed closer to its best levels in a decade before sliding. EUR/GBP spent most of the week tumbling, eventually touching its lowest levels in around half a month on Friday.
EUR/GBP closed last week at the level of 0.8954 after a two pence drop. This week so far, EUR/GBP is edging higher again, but the pair’s gains are limited.
Both currencies are being weighed by a slightly stronger US Dollar (USD) today. Euro (EUR) and Pound (GBP) investors are awaiting further coronavirus developments and stimulus from domestic governments.
Euro (EUR) Exchange Rates Resilient amid Hopes for New EU Stimulus Package
The Euro lost a lot of ground last week. Investors sold the currency from its highs against the Pound following weeks of losses for the British currency.
This was due to significant stimulus measures from the US, which finally injected some much needed liquidity and signs of calm into markets.
However, the Euro remains fairly appealing overall. It is a relatively safe currency amid the coronavirus crisis and benefits from times of weakness in its rival the US Dollar (USD).
Due to this and the latest hopes for fresh stimulus from the EU, EUR was a little stronger against the Pound today.
European Commission President Ursula von der Leyen announced over the weekend that the EC will propose a new stimulus package. It will help the EU to recover from the fallout of the coronavirus pandemic.
Pound (GBP) Exchange Rates Slip after Week of Recovery
Last week saw investors piling into the Pound. The British currency mounted an impressive recovery as it began to climb back some of the significant losses it had seen on coronavirus jitters.
This was largely a correction rebound from the Pound’s cheapest levels after it had plummeted so low against many major rivals, including the Euro and US Dollar (USD). The movement was spurred on by the US stimulus moves, which improved market liquidity.
However, the Pound’s drive remains limited. The British currency slipped against many major rivals today, including the Euro.
While Sterling’s losses against the Euro were modest, the Pound was highly unappealing overall. Investors were hesitant to keep buying the British currency after last week’s rebound, and its momentum appears to have run dry for now.
Euro to Pound (EUR/GBP) Exchange Rate Awaits Coronavirus Stimulus
The Euro remains a fairly appealing currency amid the mixed market appetite for risk. While the US Dollar’s (USD) safe haven appeal is once again strengthening it this week, the Euro will continue to benefit from moments of USD weakness.
The Euro is likely to be even more appealing if the EU boosts its own stimulus efforts.
It is a similar story for the Pound. Pound investors were generally unsurprised by last week’s UK fiscal stimulus news, but there is still speculation that more stimulus is ahead.
If the UK Treasury introduces new stimulus that is particularly impressive, the Pound could finally see a more solid boost in demand.
However, as Brexit uncertainty and expectations of a deep coronavirus-caused recession also linger, there is currently little to boost the Pound. This could make it easier for the Euro to Pound (EUR/GBP) exchange rate to keep climbing and avoid more significant losses.
