GBP/EUR Exchange Rate Sinks as German Economy ‘Shows Resilience’
The Pound Euro (GBP/EUR) exchange rate is down today and is currently trading around €1.1652 on the inter-bank market.
The Euro (EUR) gained against the Pound (GBP) today following the publication of the German IFO expectations figures for March, which increased above expectation to 95.6 against February’s 93.8.
These were followed by the German IFO business climate figures for March, which also increased to a better-than-expected 99.6.
Clemens Feus, the President of the IFO Institute, commented:
‘The companies are somewhat more satisfied with their current business situation, and they are decidedly more optimistic regarding business in the coming six months. The German economy is showing resilience.’
Sterling, meanwhile, has once again been weakened on Brexit uncertainty as Prime Minister Theresa May has come under increasing pressure from MPs to resign in order to secure her withdrawal agreement through Parliament.
The former Foreign Secretary, Boris Johnson, said:
‘[T]he PM could still set out convincing proofs of how the next phase of the negotiations – when all the key questions are to be settled – will be different from the first… It is time for the PM to channel the spirit of Moses in Exodus, and say to Pharaoh in Brussels – LET MY PEOPLE GO.’
GBP/EUR Exchange Rate Falls on Doubts of Third ‘Meaningful Vote’
Many Pound traders have become increasing nervous today, as doubts are increasing on whether the important third ‘meaningful vote’ will go-ahead in Parliament this week.
Today also saw the European Commission admit that a no-deal Brexit was becoming ‘increasingly likely’, which has left many Sterling traders feeling jittery.
There are no UK economic data releases today, with many Pound traders instead focusing on Downing Street which is set to announce whether there will be a third ‘meaningful vote’ tomorrow, or, at some later point this week.
The Environment Secretary, Michael Gove, has, however, remained optimistic, saying:
‘I believe we can [get the deal] and I think it’s critically important that we do… The country sent a clear instruction at the time of the referendum, 17.4 million people said that we need to leave the European Union. The prime minister is honouring that, she is giving everything she can to get the deal over the line and we need to support her in that effort.’
GBP/EUR Forecast: Pound Could Rise on MP Backing of May’s Brexit Deal
Euro investors will be looking ahead to the publication of the German Gfk Consumer Confidence Survey figures for April tomorrow. Any signs of improvement would prove beneficial for the single currency.
Tomorrow will also see the publication of the UK BBA mortgage approvals figures for February.
The Pound Euro (GBP/EUR) exchange rate, however, will remain sensitive to Brexit developments this week, and with any signs of Theresa May’s deal gaining increasing traction from MPs, this could prove Pound-positive.