Last week the Euro fluctuated as UK economic reports surprised to the upside while data for the Eurozone put in a pretty mixed performance.
On Thursday the GBP/EUR pairing was able to soar as the European Central Bank slashed the main refinancing rate to a fresh record low of 0.25 per cent and delivered a fairly pessimistic policy statement.
The Pound to Euro Exchange Rate is currently trading in the region of 1.1951 as of 11:10 GMT
ECB President Mario Draghi warned investors of the likelihood of a ‘prolonged period of low inflation’ and the appeal of the Euro was further diminished by the news that top ratings agency Standard & Poor’s downgraded France, the Eurozone’s second largest economy.
That being said, encouraging German trade balance data and a lacklustre UK trade report helped the Euro recover some losses against the Pound before the close of trade on Friday and the common currency remained slightly stronger against Sterling as a fresh week of trading got underway.
However, with UK inflation, employment and retail sales reports all scheduled for release over the next few days and economists expecting disappointing growth data for the Eurozone, the outlook for the GBP/EUR pairing is neutral-positive.
While the week gets off to a fairly slow start, tomorrow’s German and UK inflation figures are likely to impact the GBP/EUR pairing while Wednesday’s UK employment figures, BoE inflation report and Eurozone industrial production figures are likely to inspire significant volatility.
The GBP/EUR Exchange Rate hit a high of 1.2008
Further fluctuations can be expected on Thursday as GDP data for the Eurozone, France and Germany is published.
Economists are forecasting that French GDP climbed by 0.1 per cent in the third quarter (quarter-on-quarter) following expansion of 0.5 per cent in the previous three months.
The German economy meanwhile is expected to have grown by 0.3 per cent in the third quarter following expansion of 0.7 per cent in the second.
It has also been predicted that Eurozone growth slowed from 0.3 per cent to 0.1 per cent in the third quarter, emphasising the fragility of the 17-nation currency bloc’s recovery.
UK retail sales data and the publication of the ECB’s monthly report will also be of interest on Thursday.
If the Eurozone growth reports meet expectations, or if UK retail sales climb unexpectedly in October, the Pound could enjoy a notable gain against the Euro.
Before the week comes to a close a final burst of volatility could be inspired by Eurozone inflation data.
Current Euro (EUR) Exchange Rates
< Lower > Higher
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3399 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8367 >
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4269 >
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6172 <
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7473 <
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1951 <
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6994 <
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6189 >
(Correct as of 11:10 GMT)
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