Pound Sterling to Euro (GBP/EUR) Exchange Rate Pares Decline on Sales Increase
The Pound Sterling to Euro (GBP/EUR) exchange rate trimmed some its previous losses on Thursday as UK retail sales were shown to have risen by 0.7% on the month in February – almost twice the 0.4% gain expected by economists.
The data saw the Pound Sterling to US Dollar (GBP/USD) exchange rate extend its earlier gains and consolidate its position above 1.49.
The Pound Sterling to Euro (GBP/EUR) exchange rate is trading in the region of 1.3556
Pound Sterling to US Dollar Exchange Rate News: US Dollar Gains as Inflation Prints at 0%
The Pound Sterling to US Dollar (GBP/USD) exchange rate extended declines during the North American session as the US released stronger-than-anticipated inflation figures.
Economists had forecast that the annual rate of non-core inflation would hold at -0.1% but it actually rose to 0.0%.
The core index, meanwhile, accelerated from 1.6% to 1.7%, as expected.
The data supports the case for the Fed raising rates this summer, so gave the US Dollar a broad-based boost.
The Pound Sterling to US Dollar (GBP/USD) exchange rate is currently trading in the region of 1.4885
Meanwhile, the Pound Sterling to Euro (GBP/EUR) currency pair trimmed some of its declines as trading progressed, pushing back above the 1.36 level before the close of trading.
Pound Sterling to Euro Exchange Rate News: GBP/EUR Down 0.5% after UK CPI
The Pound Sterling to Euro (GBP/EUR) exchange rate extended declines as trading progressed on Tuesday and the UK’s inflation figures fell short of forecasts.
British non-core inflation fell to 0% in February, year-on-year, rather than easing to 0.1% as expected.
The core measure of consumer prices also registered a steeper-than-anticipated slide, moving from 1.4% to 1.2%.
One economist said of the result; ‘It looks odds on that inflation will turn negative in March, when the cut in gas prices by British Gas (the utility company with the biggest market share) will show up in the inflation figures for the first time. And inflation is then likely to remain around zero/slightly negative for the rest of the year.’
The GBP/EUR currency pair fell below 1.36 after the data was published and the GBP/USD exchange rate moved further away from the key support level of 1.50.
The Pound Sterling to Euro (GBP/EUR) exchange rate was trading in the region of 1.3593
The Pound Sterling to US Dollar (GBP/USD) exchange rate was trading in the region of 1.4936
Ahead of the release of inflation data for both the UK and US, the Pound Sterling to Euro (GBP/EUR) exchange rate was trading in the region of 1.3617 (down 0.3% on the day’s opening levels) while the Pound Sterling to US Dollar currency pair was flat at 1.4964.
Pound Sterling to Euro (GBP/EUR) Exchange Rate News: Strong German Manufacturing Data Boosts Euro
The Pound Sterling to Euro (GBP/EUR) currency pair continued its downtrend as the European session opened and the Eurozone published Services, Manufacturing and Composite Purchasing Managers’ Indexes for the region’s largest economies.
Although the Manufacturing and Composite measures for France fell short of forecasts, the Services index for the Eurozone’s second largest economy declined by less-than-expected in March.
Meanwhile, Germany’s gauges of both Services and Manufacturing climbed further into growth territory than anticipated.
The Pound Sterling to Euro (GBP/EUR) exchange rate hit a low of 1.3598
The data showed the most impressive rate of private sector output in Germany for eight months and prompted this response from Markit economist Oliver Kolodseike; ‘March’s flash data provide further encouraging news for Germany’s private sector economy, with output and new order growth accelerating to the quickest since the summer of last year. An improving economic environment and stronger demand from both domestic and foreign markets were some of the reasons behind stronger growth in March, according to our panel members.’
The figures lent the common currency support and ensured that Sterling failed to exert itself ahead of today’s key UK inflation data.
Pound Sterling to US Dollar (GBP/USD) Exchange Rate News: US Deflation Weighs on Fed Rate Hike Expectations
With yesterday’s US Existing Home Sales data falling short of forecasts and economists betting that the US Consumer Price Index held at -0.1% on the year in February, the Pound Sterling to US Dollar (GBP/USD) exchange rate continued trending around the key support level of 1.50.
A sharper slide in US inflation could prevent the Federal Reserve from increasing interest rates this year, so a below-forecast figure may push the Pound higher against its US peer.
The Pound Sterling to US Dollar (GBP/USD) exchange rate hit a low of 1.4913
That being said, if consumer prices in the world’s largest economy recovered by more than 0.2% on the month (as forecast) the Pound may return to trending around multi-year lows.
US New Home Sales figures and the nation’s Richmond Fed Manufacturing Index will also be of interest.
Pound Sterling to Euro (GBP/EUR), Pound Sterling to US Dollar (GBP/USD) Exchange Rate Forecast: UK and US Inflation Reports Key Market Movers
The UK’s Consumer Price Index is believed to have risen 0.3% on the month in February, resulting in an annual figure of 0.1%.
However, if inflation moved into negative territory the prospect of a 2015 Bank of England (BoE) interest rate adjustment would seem even more remote and the Pound could tumble.
The core CPI is expected to have slipped from 1.4% to 1.3%. As the core measure strips out volatile elements like energy prices, a decline in this measure is of greater concern than a dip in the non-core index as it indicates that deflationary price pressures extend beyond the drop-off in crude oil.
Investors with an interest in the Pound to Euro (GBP/EUR) exchange rate will also be looking ahead to tomorrow’s German IFO Business Climate, Current Assessment and Expectations indexes.
Similarly, Wednesday’s US Durable Goods Orders figures are likely to have a notable impact on Pound Sterling to US Dollar (GBP/USD) exchange rate movement.
The Euro to Pound Sterling (EUR/GBP) exchange rate was trading in the region of 0.7345 the Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.4954, the US Dollar to Pound Sterling (USD/GBP) exchange rate was trading in the region of 0.6685, the Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3606