Pound Euro Exchange Rate News: GBP Hurt by Brexit
The Pound Euro (GBP/EUR) exchange rate remains close to its worst levels in a year, reflecting the fact that a no-deal Brexit is seemingly a distinct possibility.
While Sterling continues its downward trajectory the Euro remains relatively stable, having been spared any fluctuations by a stall in new Eurozone data and a lack of compelling political developments.
Can Pound (GBP) Exchange Rates Recoup Losses?
As a gloomy Brexit outlook continues to influence the Pound’s (GBP) trajectory, various pundits have issued warnings about the likelihood of a no-deal exit.
Most recently was the UK’s International Trade Secretary Liam Fox, who predicted that there is now a 60/40 chance that the UK will crash out of the EU with no deal in place.
While this is not a guarantee yet, with Prime Minister Theresa May scrambling to salvage a cohesive deal with the EU, negativity from Fox is particularly disheartening for GBP investors in light of his previous conviction that the UK would leave the EU ‘easily’.
A lull in domestic data has meant that the Pound cannot gain any traction, but an assortment of data tomorrow, including quarterly GDP growth, could give Sterling a sorely-needed lift.
Euro (EUR) Exchange Rates Firm following ECB Economic Bulletin
The Euro (EUR) has remained relatively stable recently, leaving its exchange rates at the mercy of developments abroad, and the European Central Bank’s (ECB) latest economic bulletin this morning served to highlight the Eurozone’s economic trajectory.
The bulletin stated that ‘The Euro-area economy is proceeding along a solid and broad-based growth path,’ an assertion that mirrors the data displayed in the Eurozone’s recent data.
The bulletin also highlighted the ‘downside risks’ to the global economy, which have been exacerbated by trade tensions and an ever-nearing Brexit.
Pound Euro (GBP/EUR) Exchange Rate Forecast: UK GDP Data Ahead
Tomorrow will see the UK GDP for the second quarter released, with the figures forecast to increase by 0.4%.
This would likely turn around some of the Pound’s poor form, and a favourable uptick in the industrial production figures might also serve Sterling well against its major peers ahead of the weekend.
Looking ahead for the Euro, the publication of France’s industrial production data for June tomorrow morning may aid the Euro to get a head start on its peers should the figure be favourable, but the lack of high-impact data may leave the Euro’s strength relatively unchanged, causing it to trade higher against the Pound should Brexit tensions heighten.