In a comparatively quiet news day for the Eurozone, Euro movement was a little stilted but global developments helped the common currency advance on two of its major rivals – the Pound and US Dollar.
While the Pound began the day strongly, preparing to post five-day gains on several of its peers, Sterling tumbled as European trading progressed and less-than-impressive industrial, construction and manufacturing output data for the UK put the nation’s fourth quarter growth in doubt.
Given the recent run of positive reports for the UK this result was something of a surprise and the Pound declined accordingly.
As economist James Ashley highlights; ‘The recovery remains broadly on track – but today’s data are a reminder that we have not year reached the sunlit uplands that would pave the way towards thoughts of policy tightening.’
This news was followed by a report detailing UK growth of 0.7 per cent, down from previous expansion of 0.8 per cent.
As the Bank of England was expecting the UK to post quarterly growth of 0.9 per cent the NIESR data is a bit of a blow and indicates that the nation didn’t enter 2014 with as much gusto as hoped.
However, Britain is still expected to have expanded by 1.9 per cent across the whole of 2013, considerably better than the paltry 0.3 per cent growth recorded in 2012.
That being said, NIESR did comment; ‘We do not expect output to pass its peak in early 2008 until 2014.’
The Euro was also able to benefit from the news that Standard & Poor’s ratings agency left Germany’s credit rating unchanged at AAA with a stable outlook due to the nation’s ‘highly diversified and competitive economy’.
Next week UK news to look out for includes producer price/consumer price figures, the UK retail price index and December’s retail sales report.
Of course data from the Eurozone (such as final German inflation figures) may also drive GBP/EUR movement.
Euro (EUR) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Euro,,US Dollar,1.3679 ,
Euro,,British Pound,0.8295 ,
Euro,,Australian Dollar,1.5234 ,
Euro,,New Zealand Dollar,1.6489 ,
Euro,, anadian Dollar,1.4922 ,