- UPDATE: Euro falls as data suggests more stimulus is needed
- UPDATE: Younger voters swayed towards ‘Remain’ vote by Obama
- UPDATE: Ladbroke says 90% of recent referendum bets for ‘Remain’ victory
- Obama urges UK to remain part of European Union
- Recent ‘Brexit’ polls show support for ‘Leave’ waning
- Eurozone PMIs disappoint
- Greek debt discussions today could provoke volatility
Ladbrokes see Biggest Shift in Campaign Bets so Far
Betting firm Ladbrokes have revealed that, in the last 48 hours, 90% of EU referendum bets have been on a victory for the ‘Remain’ camp. The firm have lowered their chances of a ‘Brexit’ from 34% to 29%.
Pound Bullish as Eurozone Data Indicates More Stimulus Necessary
Pound Sterling’s gains against the Euro have extended to 0.6%, as investors interpret the morning’s Eurozone data as yet more evidence the European Central Bank (ECB) will be forced to loosen monetary policy further.
According to Capital Economics’ European Economist Jack Allen, ‘Overall, the survey suggests that the Eurozone’s economic recovery is still too slow to generate much upward pressure on inflation. We think that the ECB will eventually need to do more to boost growth and inflation.’
Younger Voters more Responsive to Obama Intervention
A snap poll conducted by Sky of its customers has found that the majority of UK voters don’t believe the President should have gotten involved in the EU referendum. The poll found that 60% of respondents were unwelcoming of the President’s input.
However, the pro-EU camp is still likely to welcome the move, as while the poll found that Obama’s comments made 17% of voters less likely to support the ‘Remain’ campaign, 25% claimed it will increase their likelihood of supporting the European Union. Among voters aged 18-34, 40% are more likely to vote to ‘Remain’ after Obama’s comments, compared to just 15% of voters above the age of 55.
Pound Sterling (GBP) is making solid gains today against the Euro (EUR) after intervention in the ‘Brexit’ debate by US President Barack Obama.
Meanwhile, the Euro is weakened after a round of disappointingly mixed data.
Pound (GBP) Strengthened by Obama Support of ‘Bremain’
US President Barack Obama has voiced his belief that the UK should vote to remain a part of the European Union when it goes to the polls on June 23rd. Speaking as a ‘friend and ally’, Obama urged the UK to remain part of the EU in order to preserve its strong political voice.
‘As citizens of the United Kingdom take stock of their relationship with the EU, you should be proud that the EU has helped spread British values and practices – democracy, the rule of law, open markets – across the continent and to its periphery,’ he wrote in an article for the Daily Telegraph.
His intervention has infuriated supporters of a ‘Brexit’, who questioned Obama’s right to interfere in British politics. The President was castigated by London Mayor Boris Johnson, who penned an article for the Sun claiming:
‘For the United States to tell us in the UK that we must surrender control of so much of our democracy is a breathtaking example of the principle of do as I say, not as I do. It is incoherent. It is inconsistent, and yes, it is downright hypocritical.’
‘Remain’ campaigners have defended the President, however, claiming that Obama’s comments come after some members of the ‘Leave’ campaign suggested the UK’s special relationship with the US could be strengthened by a ‘Brexit’.
In another key development which has calmed investors and boosted GBP/EUR exchange rates, influential political blogger Matt Singh’s latest calculations for the probability of a ‘Brexit’ have dropped to 20% after recent polls showed growing support for the ‘Remain’ camp.
Mixed Eurozone PMIs Keep EUR/GBP Exchange Rate Muted
The Euro is putting on a lacklustre performance today after the latest slew of Markit PMIs failed to provoke clear movement in either direction. In positive news, the French composite and services PMIs, German manufacturing and Italian Industrial Sales and Orders all beat their forecasts. However, the Eurozone’s three PMIS all printed below-forecast, with the services index rising marginally less-than-predicted and the manufacturing and composite indexes dropping unexpectedly.
However, in positive news Pierre Moscovici, European Economic and Monetary Affairs Commissioner, has announced that international creditors are drawing near to an agreement regarding the Greek bailout. Speaking to reporters, Moscovici said:
‘I can tell you that there was very good progress in Athens. [In] my view, we are close to an agreement. This agreement is possible. We need for that to have a credible package of reforms, which are economically adapted, financially sustainable and which are socially fair.’
Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast: ‘Brexit’ and Eurogroup Meeting to Provoke Volatility
With the day’s main data released, market sentiment is likely to be a key driver in GBP/EUR exchange rate movement for the rest of the session. The UK referendum argument is likely to continue throughout the day, while a Eurogroup meeting to discuss Greek debt conditions could help move the Euro if there are further suggestions of an accord being reached.
Current GBP/EUR Conversion Rates
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trading between 1.2674 and 1.2728.
The Euro to Pound Sterling (EUR/GBP) exchange rate is currently trending between 0.7855 and 0.7884.