The Pound Sterling (GBP) has fallen by -0.5% against the Euro (GBP/EUR) today, on account of the single currency rising unexpectedly in value this afternoon.
Gathering US Economic Optimism could Hamper Euro’s (EUR) Future Performance
While the Euro (EUR) was making a number of positive movements in pairings at the time of writing, the coming weeks and months may see this strength rapidly eroded. This is due to today’s US Change in Non-Farm Payrolls result for December being highly supportive for the US Dollar (USD) and fuelling speculation that further US interest rate hikes could be in store.
The Pound Sterling (GBP) has made a gain of 0.4% against the Euro (GBP/EUR) today, something mainly due to the morning’s German Industrial Production and Trade Balance surplus for November both decreasing on previous figures.
UK Trade Balance Figures due Imminently, Potential for GBP Uptrend if Forecasts Met
The next GBP/EUR related data will come from the UK, with the announcement of the Trade Balance movement for November. At the time of writing, forecasts were largely positive with a reduction in the deficit being predicted for all three contributing fields.
The Pound Sterling (GBP) has remained low against the Euro (GBP/EUR) today, hitting a scarcely improved -1.1%. This comes after Chancellor George Osborne warned listeners in Cardiff about a ‘creeping complacency’ surrounding the national economy.
Osborne Sees UK Economy as Top Priority, but Doomsaying Panics Investors
The Pound Sterling’s (GBP) overall downtrend today began before Osborne started his speech and has failed to be dispelled following its delivery.
Speaking in Cardiff, the Chancellor stated that: ‘Last year was the worst for global growth since the crash and this year opens with a dangerous cocktail of new threats from around the world. For Britain, the only antidote to that is confronting complacency and delivering the plan we’ve set out’.
The Pound Sterling to Euro (GBP/EUR) exchange rate has tanked today along with most of the other GBP pairings. The likely cause is a severe decline in investor confidence after it was announced that Chancellor George Osborne would be discussing a ‘cocktail’ of threats that are on the horizon for the UK economy.
GBP/EUR Exchange Rate News: UK Interest Rate Adjustment Pushed Back Today by BoA ML
The Pound Sterling (GBP) has been making largely on the decline today, with announcements over the UK economy being the primary cause. The only domestic data releases have been rising Halifax House Prices for December and a similarly forecast-exceeding annual New Car Registrations report for December.
However, Sterling’s downfall today has largely been brought about by the news that Osborne will be predicting doom and gloom for the UK economy unless the myriad threats that he identifies can be successfully avoided. The other detrimental factor has been the adjustment from Bank of America Merill Lynch, who have pushed back their expectations for a UK interest rate hike from May to November this year.
The Pound Sterling has fallen by -0.4% against the United Arab Emirates Dirham (GBP/AED), -1.1% against the Swiss Franc (GBP/CHF) and -1.2% against the Euro (GBP/EUR), the Czech Koruna (GBP/CZK) and the Danish Krone (GBP/DKK). This represents a significant deterioration of the Pound’s value relative to yesterday’s above-water status.
Euro (EUR) on the Up After Eurozone Unemployment Reduction
The Euro (EUR) has fared substantially better than the Pound (GBP) today, having largely been held up by supportive economic releases. These started early with German annual Factory Orders for November increasing healthily from -1.6% to 2.1%.
Following on from this were the same nation’s Construction and Retail PMIs for December, which both rose on prior printings. Possibly the most beneficial result today has come from the Eurozone, which has printed an unexpected drop in the November Unemployment Rate from 10.6% to 10.5% against predictions of a rise to 10.7%.
The Euro’s gains today have included 1.1% against the Pound Sterling (EUR/GBP), 1.6% against the Australian Dollar (EUR/AUD) and 1.9% against the South African Rand (EUR/ZAR).
GBP/EUR Exchange Rate Forecast: Final German Weekly Releases Tomorrow along with UK Trade Data
Eurozone data will have the first impact on the exchange rate movement of the GBP/EUR pairing, with the release of the German yearly Industrial and Trade Balance figures for November. As of writing, forecasts have been for a rise in the industrial sector but a reduction in the current trade surplus from 22.3bn to 20.2bn.
The UK’s notable data will also concern its Trade Balance for November, where the current deficit is forecast to be reduced compared to previous results.
Current GBP, EUR Exchange Rates
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3411 and the Euro to Pound Sterling (EUR/GBP) exchange rate was trending in the region of 0.7458 today.