The Pound Sterling to Euro (GBP/EUR) exchange rate edged higher by around 0.12% on Friday morning.
As traders await British data, the Pound is generally softer versus the majority of its most traded currency rivals. Further declination is as a result of traders locking profits after Sterling’s healthy surge on Thursday.
The common currency, meanwhile, softened versus nearly all of its major peers as traders await the Eurogroup meeting. Domestic data printed relatively positively, however, which has provoked a fractional rebound. The single currency is likely to surge if the Eurogroup meeting finds a solution to Greece’s debt crisis.
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.3581.
The Pound Sterling to Euro (GBP/EUR) exchange rate strengthened by around 0.57% on Wednesday morning.
After British economic data printed very positively, the Pound strengthened versus the majority of its most traded currency rivals. With labour data improving, and with inflation falling as a result of low energy prices, speculation that the Bank of England (BoE) will act hawkishly in their next policy meeting is likely to see continued Sterling support.
The Euro, meanwhile, is generally trending lower versus most of its major peers after Eurozone construction data failed to impress. Further declination can be attributed to anxieties regarding Greece’s position in the Eurozone as they barter for an extension on their massive loan repayments.
The Pound Sterling to Euro (GBP/EUR) exchange rate is currently trending in the region of 1.3536.
Pound Sterling (GBP) Exchange Rate Rallies on Labour Data
British data printed particularly positively on Wednesday which caused the Pound to rally versus nearly all of its major peers. Of particular significance was Jobless Claims Change, which saw -38,600 fewer benefits claims, eclipsing predictions of 25,000 fewer claimants. This, coinciding with December’s Unemployment Rate dropping from 5.8% to 5.7%, is fuelling speculation that the BoE will lead the way in a rate hike cycle.
‘Improving nominal pay, along with falling petrol and food prices, should combine in a powerful cocktail that puts the fizz back in the UK recovery,’ said Rob Wood, an economist at Berenberg Bank in London. ‘We expect the BOE to hike rates faster than the markets expect, starting with a first hike in February next year.’
In addition, Average Weekly Earnings bettered estimates of a 1.7% increase, with the actual result advancing by 2.1%. Employment Change eclipsed the median market forecast of a jobs gain of 50,000, with the actual result reaching a staggering 103,000 new positions.
The Pound Sterling to Euro (GBP/EUR) exchange rate dropped to a low of 1.3451 today.
Euro (EUR) Exchange Rate Softens on Eurozone Construction Output
With Greece’s position in the Eurozone questionable after the Eurogroup failed to present an attractive enough offer to help them with their debt crisis, investor confidence in the common currency is dwindling.
‘It’s not about an extension of the loan program, it’s about whether this program is fulfilled, yes or no,’ German Finance Minister Wolfgang Schaeuble told German broadcaster ZDF late Tuesday. ‘I don’t have any new information, but there is no loan agreement, it’s an assistance program. And in this seemingly unimportant detail lies the key: Greece would like to receive credit, but not fulfil the conditions to allow Greece to recover economically.’
In addition, Eurozone Construction Output failed to improve upon previous figures on both a yearly and a monthly basis in December, aiding the single currency depreciation.
Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast to Extend Gains
With sentiment towards the common currency ever cooling, and with British data promoting speculation of a rate hike, the Pound Sterling to Euro (GBP/EUR) exchange rate is likely to continue trending higher for the remainder of Wednesday.
Thursday ought to see GBP/EUR volatility as the European Central Bank (ECB) publishes its account of their most recent monetary policy meeting. Eurozone Consumer Confidence will also be of significance to those invested in the shared currency.
The Pound Sterling to Euro (GBP/EUR) exchange rate climbed to a high of 1.3554 today.