The Pound Sterling (GBP) has advanced to 0.7% against the Euro (GBP/EUR) today, potentially on account of the recent assertion from the UK government that the recent Google tax news was ‘a good deal’.
A House Divided? Not So, says Downing Street
The Pound’s (GBP) surprising recovery today may be partially due to investors being placated by the recent statement from Downing Street, where a spokesman has stated ‘the Prime Minister and the Chancellor are of the same mind on this’. This comes after earlier evidence that David Cameron apparently disagreed with the optimistic nature of George Osborne’s announcement regarding the amount claimed by HMRC.
The Pound Sterling (GBP) has made a gain of 0.4% against the Euro (GBP/EUR) today, having been bolstered by confidence-filled responses from Bank of England (BoE) Governor Mark Carney.
Carney’s Highlights – Brexit Possibilities and That Historic Fed Decision
The Pound’s (GBP) gradually improving condition today can be attributed to some of the answers given to Carney’s questions from the Treasury Select Committee, including one over the likely results of an ‘Out’ vote in the referendum. Although Carney’s response was essentially noncommittal, the fact that he didn’t make a bleak forecast bolstered the Pound in the immediate aftermath.
Additionally, Carney stated that December’s Fed interest rate hike was a contributing factor to the current market volatility, but certainly not the only one.
The Pound Sterling (GBP) has fallen by -0.4% against the Euro (GBP/EUR) today, while the Euro (EUR) has conversely advanced against a number of its competitors due to a surprisingly positive reaction to European Central Bank (ECB) President Mario Draghi’s speech yesterday evening.
Carney Testimony due in Near Future, Minor Eurozone Employment Rate Stat due Later
GBP/EUR exchange rate movement in the near future is likely to be caused by an imminent delivery by Bank of England (BoE) officials including Governor Mark Carney at the Treasury Select Committee Hearing, as well as this afternoon’s release of Luxembourg’s Unemployment Rate in December. At the time of writing, this was forecast to remain at 6.7%.
The Pound Sterling (GBP) has failed to reverse its condition against the Euro (GBP/EUR) today, with a narrow trending representing the best positive movement for Sterling so far.
Further Belgium Ecostats due Shortly, along with Later Draghi Speech
Having already contributed supportive Industrial Production results for November, Belgium is set to have further input into the Euro’s (EUR) value with the announcement of the January Business Confidence results this afternoon.
Current expectations are for a worsening from -1.4 points to -2.
The Pound Sterling to Euro (GBP/EUR) exchange rate has declined by a small amount today, with the British currency also putting on a fairly poor performance against the majority of its currency rivals.
GBP/EUR Exchange Rate News: ‘Derisory’ UK Back-Tax Result Disheartens Investors Today
The Pound Sterling (GBP) has fared poorly overall today, with losses of -0.2% against the Euro (GBP/EUR), -0.3% against the Czech Koruna (GBP/CZK) and -0.4% against the Japanese Yen (GBP/JPY) being recorded. Elsewhere, the Pound has largely made minor gains, although a few exceptions of 0.3% against the Australian Dollar (GBP/AUD) and 0.5% against the Mexican Peso (GBP/MXN) have also been recorded. This decline against the Euro (EUR) is effectively a reversal of last week’s pairing movement.
Among other developments, one of the most impactful UK economic events today has been the news that approximately £130m has been secured by Chancellor George Osborne from Google in reparation for back-taxes, despite a far larger sum actually being owed.
Economist Richard Murphy estimates that Google should be paying £200m per year and has stated: ‘I can’t understand why the deal with Google is so cheap. I’m worried if [the UK government] is going to repeat that with other companies’.
Euro (EUR) Advances against Competitors Today in Anticipation of Draghi Speech
The Euro (EUR) has put on a mostly positive performance against its competitors today, with gains being seen of 0.3% against the Pound Sterling (EUR/GBP), 0.6% against the Australian Dollar (EUR/AUD) and 0.8% against the Canadian Dollar (EUR/CAD).
Although today’s domestic data has been relatively poor for the prospects of the Euro, the single currency has nonetheless been boosted by the slim possibility of a hawkish statement from European Central Bank (ECB) President Mario Draghi later this evening.
GBP/EUR Exchange Rate Forecast: CBI Stats due Shortly, Draghi Delivery Later On
The next economic data likely to generate movement within the pairing will come from the UK, with the announcement of the Confederation of British Industry (CBI) Trends for Total Orders, Selling Prices and Business Optimism in January results. At the time of writing, the only forecast made had been for the Total Orders result, which was forecast to fall from -7 points to -10.
On the Eurozone side of things, input will be had by the evening’s speech from Draghi, who is scheduled to give a keynote address in Eschborn.
Current GBP, EUR Exchange Rates
The Pound Sterling to Euro (GBP/EUR) exchange rate was trending in the region of 1.3185 and the Euro to Pound Sterling (EUR/GBP) exchange rate was trending in the region of 0.7586 today.