- Sterling positive against most peers – Previous poor inflation data had limited effect
- Incoming earnings stats to create volatility – GBP could dip if earnings drop
- Euro mixed on ECB’s Nouy speech – Concerns voiced on low interest rates
- UK earnings, unemployment and claims data due – Eurozone inflation stats also out
The Pound has been a relatively stable bet for investors of late, despite supposedly detrimental circumstances.
The Euro has been giving a relatively poor performance so far, potentially owing to recent comments from a European Central Bank (ECB) official.
UK Economic News: Falling National Inflation Rate Fails to Dent Pound’s Appeal
The Pound (GBP) has made a number of advances against its peers of late, which comes at odds with the most recent domestic data concerning the UK.
Yesterday’s national inflation rate results for April proved a universal disappointment, having fallen on the month and the year for the base field and also in the core annual printing.
In response to the news, Trade Union Congress (TUC) General Secretary Frances O’Grady said:
‘The UK’s continuing low inflation is a sign that the economy still lacks the demand needed to get back to full strength. Wage growth remains too weak and we do not have the level of public investment needed to secure stronger growth’.
Pound gains made of late have included 0.3% against the Euro (GBP/EUR), 0.4% against the Australian Dollar (GBP/AUD) and 0.8% against the Polish Zloty (GBP/PLN).
Euro (EUR) Uncertain in the Wake of Strong US Ecostats
The single currency has been an uncertain prospect today, on account of yesterday’s rising Eurozone trade surplus being offset by comments from ECB official Daniele Nouy.
Speaking yesterday afternoon, Nouy warned that lenders in the Eurozone should be adapting to what may end up being long-term low interest rates, as part of the ECB’s policy efforts to accelerate the recovery of the Eurozone.
In addition to this news, the Euro has also been harmed by the US posting a rise in base annual inflation.
The Euro has fallen by -0.3% against the Pound Sterling (EUR/GBP) and -0.5% against the US Dollar (EUR/USD) today, but has also posted gains of 0.5% against the Polish Zloty (EUR/PLN) and 0.8% against the South African Rand (EUR/ZAR).
Future GBP, EUR Forecast: Major UK Labour Market Announcements, Eurozone Inflation Incoming
The near-future will bring the announcement of the UK’s earnings, unemployment and claims figures for March and April, which are sure to have a major influence on the Pound’s perceived value over the rest of the day and perhaps the remainder of the week.
National unemployment is expected to remain at 5.1%, claims are expected to slow on previous printings and mixed forecasts have been made for the outcomes of the earnings stats.
The Euro could also be shifted shortly by the announcement of the finalised Eurozone inflation rate results for April. Forecasts have overall been for stagnations or reductions in the rate.
Current GBP, EUR Exchange Rates
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.2818 and the Euro to Pound Sterling (EUR/GBP) exchange rate was trending in the region of 0.7802 today.
