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Euro Pound Sterling (EUR/GBP) Exchange Rate Rises as Doubts Return on New Brexit Vote

European Central Bank

EUR/GBP Exchange Rate Edges Higher as May due to Face 1922 Committee

The Euro Pound (EUR/GBP) exchange rate is up today and is currently trading around £0.8735 on the inter-bank market.

The Pound (GBP) fell against the Euro (EUR) today following Theresa May’s announcement that she would go ahead with a vote on her Brexit deal in June, however with increasing doubts about parliamentary support this has proved a drag on Sterling.

Theresa May is also set to meet with the 1922 Committee executive today, which is made up of a number of influential Tory backbenchers, with questions focusing on what will happen to her leadership following the vote.

Geoffrey Clifton-Brown, the Brexit treasure of the 1922 Committee, said:

‘I think it would be much more dignified if she were to set out her own, fairly tight, timetable to go and allow a leadership contest to take place, but if she does not do that, I think a fairly firm message from the ‘22 is that we will have to very seriously consider how we can engineer a vote of confidence.’

The Euro, meanwhile, benefited from better-than-expected Eurozone trade balance figures for March, with the non-seasonally adjusted figures rising to €22.5bn against February’s €17.9bn.

EUR/GBP Exchange Rate Rises as Traders Focus on Eurogroup Meeting

Today saw the publication of the Italian CPI figures for March, which held steady at 0.2%, failing to provide much uplift for the single currency.

Many Euro traders will be paying close attention to the Eurogroup meeting today, and with any indications that the Eurozone’s economy is struggling under increasing political uncertainties ahead of the European elections, this could being to weigh on EUR/GBP exchange rate.

EUR is further benefiting from its safe-haven status as the US-China trade war continues, with President Donald Trump hitting back against the Chinese telecom giant, Huawei, by declaring a national emergency over security concerns.

With the US-China trade war weighing heavily on global markets, the Euro has tended to benefit as a result.

EUR/GBP Outlook: Sterling Could Sink on Lack of Parliamentary Brexit Consensus

Euro traders will be looking ahead to tomorrow’s printing of the Eurozone’s CPI figures for April, which are expected to ease.

Tomorrow will also see the release of the Eurozone’s construction output figures for March, which, however, are expected to fall.

Pound investors will be focusing on Brexit developments, and with any signs that Theresa May will fail to gain parliamentary support for her withdrawal deal, this could see the Sterling sink further against the single currency.