Euro to Pound Sterling (EUR/GBP) Exchange Rate Softens after Eurozone Industrial Production Declines
The Euro to Pound Sterling (EUR/GBP) exchange rate has trended lower on Wednesday afternoon following discouraging Eurozone Industrial Production figures. On the year industrial output slipped from 2.0% to 1.1%, suggesting that negative global headwinds have had a more severe impact upon the currency union than originally thought. Consequently the EUR/GBP pairing has been on a downtrend around 0.7504.
Chinese Trade Data Betters Forecast to Dent Euro (EUR) Exchange Rate as Risk Sentiment Rises
With better-than-expected Chinese data having helped to reduce safe-haven demand further today the Euro (EUR) has been ceding some of its recent gains. As traders anticipate a weaker showing from this morning’s Eurozone Industrial Production results the Euro to Pound Sterling (EUR/GBP) exchange rate has been trending lower at 1.3340.
Strong UK GDP Estimate Fails to Shore up Demand as Pound Sterling (GBP) Exchange Rates Continue to Dive
Although the NIESR Gross Domestic Product Estimate printed at a relatively optimistic 0.6% this afternoon the Pound (GBP) has remained slumped across the board. Consequently the Pound Sterling to Euro (GBP/EUR) exchange rate is trending lower at 1.3288, while the Pound Sterling to US Dollar (GBP/USD) pairing is in a sharp downtrend around 1.4393.
Demand for Pound Sterling (GBP) generally declined on Tuesday morning after the latest UK Manufacturing Production figures showed a severe contraction in output on the year.
Sliding Eurozone Investor Confidence Weighed on Euro (EUR) Amidst Fresh Chinese Stock Volatility
After making some particularly strong gains over the last week the Euro to Pound Sterling (EUR/GBP) exchange rate began to trend lower on Monday, away from its eleven-month high of 0.7545. While Chinese stock markets saw another day of decline, shedding 5% even in the absence of the circuit breaker mechanism, this did not do much to shore up demand for the single currency (EUR). Sentiment was dented by the January Eurozone Sentix Investor Confidence Index, which showed a larger decline than forecast to print at 9.6 rather than 15.7. With the strength of the currency union’s economy still somewhat under question this helped to spur the Euro down against rivals.
Pound Sterling Currency News: GBP Softened by Disappointing UK Manufacturing and Industrial Production Data Today
Although the Pound (GBP) regained some of its recent losses at the start of the week, this morning has seen a return to more bearish form. The British Retail Consortium’s (BRC) Like-For-Like Sales showed that consumer demand had failed to improve as far upon the year as hoped, rising from -0.4% to 0.1% instead of 0.5%. As this suggested that the Christmas season had provided as much of a boost to spending as anticipated, the EUR/GBP exchange rate has been making fresh gains against the softened Sterling.
Traders were equally disappointed by the revelation that the UK’s Industrial and Manufacturing Production had declined further than expected in November. Manufacturing output in particular contracted sharply, indicating persistent weakness within the sector as the UK economy shows signs of slowing. This does not appear to bode well for the nation’s GDP, leaving the Pound in a downtrend across the board.
EUR/GBP Exchange Rate Forecast: Pound Predicted to Rally on Stronger UK GDP Estimate
Bank of England (BoE) Governor Mark Carney is due to speak this afternoon, with any signs of dovishness from the policymaker likely to reduce the appeal of the Pound further. The NIESR UK Gross Domestic Product Estimate for December could prompt further volatility for the ailing currency, as a stronger assessment of economic growth would increase pressure on the BoE to begin considering an interest rate hike.
Tomorrow’s Eurozone Industrial Production figures could prompt some bearishness for the Euro, however, as pundits anticipate a decline in output both on the month and on the year. If the currency union continues to show signs of slowing the EUR/GBP exchange rate is unlikely to remain on an uptrend.
Current EUR, GBP Exchange Rates
At the time of writing, the Euro to Pound Sterling (EUR/GBP) exchange rate was making gains at 0.7497, while the Pound Sterling to Euro (GBP/EUR) pairing was slumped around 1.3339.