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Pound Sterling to Euro Exchange Rate Forecast: GBP/EUR at 1.38, Greek Deal Looks Unlikely; GBP/USD at 1.55 after US Sales

Newsflash: Pound Gains on Euro, Holds 1.55 against US Dollar

The Pound largely held gains against the Euro and was little changed against the US Dollar following the publication of the UK’s latest Construction Output report.

On a monthly basis, output fell -0.8% in April, but production surged by 1.5% on the year in April – exceeding the 0.5% growth expected.

The Pound’s gains against the Euro were also due to reports indicating that Germany is no longer ruling out a Greek default after the International Monetary Fund pulled its negotiators out of the country.

The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3846

The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5504

Earlier…

Newsflash: GBP/EUR Extends Advance, GBP/USD Exchange Rate Trends in Narrow Range as US Retail Sales Increase

After German Chancellor Angela Merkel gave the Greek PM a telling off about his lack of positive policy action, the Pound Sterling to Euro (GBP/EUR) exchange rate extended previous gains, advancing by 0.5% on the day’s opening levels.

However, the Pound Sterling to US Dollar (GBP/USD) exchange rate was little changed despite the US  Advance Retail Sales report showing the 1.2% increase in May expected by economists. The figure for April was also positively revised from 0.0% to 0.2%.

Any ‘Greenback’ gains were tempered by US initial and continuing jobless claims coming in higher than expected in the weeks ending June 6th and May 30th.

As a strong US labour market is a prerequisite of any interest rate adjustments from the Federal Reserve, the increase in the number of people in receipt of unemployment benefits was badly received.

The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3791

The Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5472

Earlier…

The Pound Sterling to Euro (GBP/EUR) exchange rate surged on Wednesday in response to encouraging UK data, but the pairing’s return to 1.37 could prove short lived if Greece finally manages to broker a deal with its creditors.

Pound Sterling to Euro and Pound Sterling to US Dollar Exchange Rate News: UK GDP and Industrial Production Data Triggers Sterling Surge, GBP/EUR Hits 1.37 and GBP/USD Rallies to 1.55

It was a good day for both the Pound Sterling to Euro (GBP/EUR) and Pound Sterling to US Dollar (GBP/USD) exchange rates on Wednesday as upbeat British ecostats gave the Pound a leg up against its major peers.

The Pound rally was initiated early in the European session as UK Industrial Production data printed more strongly than forecast. The 0.4% month-on-month and 1.2% year-on-year increases in output exceeded the respective 0.1% and 0.6% estimations and bolstered hopes that the UK economy enjoyed a rebound in the second quarter.

The Pound Sterling to Euro (GBP/EUR) exchange rate fell to a low of 1.3665

Economist Howard Archer said of the result; ‘Industrial production got off to a decent start to the second quarter. However, April’s good news on industrial production was tempered by [the drop] in manufacturing output.’

The Pound Sterling to US Dollar (GBP/USD) exchange rate fell to a low of 1.5427

Further Pound gains were accrued as the National Institute of Economic and Social Research (NIESR) released its growth estimate for the three months through May.

According to NIESR, the UK expanded by 0.6% during that period – up from positively revised growth of 0.5% in the three months through April.

UK data hasn’t all been upbeat this week however. This morning’s RICS House Price Balance printed at 34% in May rather than the 36% expected.

Euro to Pound Sterling (EUR/GBP) Exchange Rate Forecast – Greece Could Secure ‘Staggered’ Bailout Deal with German Support, Tsipras Vows to Secure Funds

The Euro to Pound Sterling (EUR/GBP) exchange rate experienced a rocky day of trading on Wednesday as conflicting reports regarding the latest developments in the Greek bailout negotiations put the common currency under pressure.

At the beginning of the day hopes of any kind of deal being brokered between Greece and its creditors looked slim as the Hellenic nation’s latest proposal was rejected and sources indicated that an informal meeting between the heads of Greece, France and Germany might not go ahead.

The Euro to Pound Sterling (EUR/GBP) exchange rate achieved a high of 0.7316

However, rumours later surfaced that Germany is keen to establish a ‘staggered aid deal’ – one which would see Greece receive some funding immediately (helping it avoid defaulting on its upcoming debt repayment) and give the nation time to present more credible reforms over the coming weeks.

The EUR/GBP exchange rate trimmed earlier declines as investors digested this prospect.

US Dollar to Pound Sterling (USD/GBP) Exchange Rate Forecast – ‘Cable’ Rallies to 20-Day High as Investors Come to Terms with BoE Rate Hike Expectations

With influential ecostats for the US in short supply on Wednesday, the Pound Sterling to US Dollar (GBP/USD) exchange rate was able to advance beyond the 1.55 level and hit a 20-day high.

It appears that investors are beginning to accept the fact that the Federal Reserve is likely to increase interest rates before the Bank of England (BoE), and that a rate adjustment from the British central bank may not occur until 2016.

The US MBA Mortgage Applications report printed at 8.4% in the week ending June 5th, up from -7.6% in the previous week.

Although the Pound has since fallen back below 1.55, there is the potential for ‘Cable’ to break through physiological resistance if US data disappoints.

The Pound Sterling to US Dollar (GBP/USD) exchange rate hit a high of 1.5510

Pound Sterling to Euro (GBP/EUR) and Pound Sterling to US Dollar (GBP/USD) Exchange Rate Forecast: US Advance Retail Sales, UK Construction Output, Eurozone Industrial Production Data Still Ahead

Before the weekend both the Pound Sterling to Euro (GBP/EUR) and Pound Sterling to US Dollar (GBP/USD) exchange rates could experience further fluctuations in response to the week’s remaining economic reports for the UK, Eurozone and US.

Although data for the European nations is in short supply today, the US is set to publish Advance Retail Sales figures.

Sales stagnated in April, but economists are expecting sturdy consumer spending of 1.2% in May. As the US economy is consumer-driven, a below forecast result could weigh on the US Dollar (and Fed rate hike bets) and drive the Pound higher against the ‘Greenback’.

On Friday the UK will be releasing its Construction Output data for April. As construction is believed to have eased on both a monthly and annual basis the report is unlikely to lend the Pound much support unless it delivers an impressive surprise.

The Eurozone’s Industrial Production numbers are thought to come in more strongly, and on or above forecast readings may see the EUR/GBP exchange rate recoup losses before the close of trade.

The Euro to Pound Sterling (EUR/GBP) exchange rate was trading in the region of 0.7278, the Pound Sterling to US Dollar (GBP/USD) exchange rate was trending in the region of 1.5454, the US Dollar to Pound Sterling (USD/GBP) exchange rate was trading in the region of 0.6472, the Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3733