Further GBP/EUR Stability Prompted by Eurozone Employment Data.
Updated 10:30 9/1/18: The GBP/EUR exchange rate continues to hold close to its starting levels this morning as the Eurozone published its latest employment stats.
The figures revealed that the unemployment rate fell from 8.8% to 8.7% across the bloc in November, striking its lowest levels since 2009.
The figures from the wider Euro area also impressed this morning as unemployment dropped below its long-term average for the first time in nine years.
German Trade and Production Figures Prompt GBP/EUR Exchange Rate to Narrow
The Pound Euro (GBP/EUR) exchange rate is trading in a narrow range this morning following the release of Germany’s latest trade balance.
At the time of writing GBP/EUR is almost unmoved from today’s starting levels, with the pairing having retreated from its early gains.
Euro (EUR) Lifted by Stronger than Expected German Trade Figures
The Euro was able to reverse its decline this morning as markets reacted to Germany latest trade balance.
According to data published by Federal statistics agency, Destatis, Germany’s trade surplus leapt from €18.9bn to €23.7bn in November, beating expectations of a more modest rise to €21.5bn.
The uptick was largely supported by an impressive 4.1% jump in exports, easily outpacing forecasts of a 1.2% rise.
EUR investors will also be pleased to learn that imports jumped 2.3% as it suggests that domestic consumption is climbing, something which should to help balance trade across the Eurozone.
On top of this accompanying data revealed that German industrial production rallied hard in November as it surged from -1.2% to 3.4%, the largest monthly rise since September 2009.
Sterling’s (GBP) Resilient as BRC Reports Retail Sales Remain Robust in December
At the same time the Pound has been able to prevent any major losses against the Euro this morning thanks to the latest retail figures from the British Retail Consortium (BRC).
The consortium reported that like-for-like sales growth held at 0.6% last month, beating forecasts that it would slip to 0.3%.
However the figures also revealed that spending slowed in the last quarter of 2017, with it falling to 1.1% between October and December after averaging 1.7% during the rest of the year.
The decline in spending was largely attributed to the financial pressures facing consumers as wage growth continues to flag behind inflation, which struck a six-year high of 3.1% in November.
GBP/EUR Forecast: Eurozone Unemployment to Fall?
Looking to later this morning the GBP/EUR exchange rate may continue to relinquish some of its recent gains following the publication of the Eurozone’s latest employment figures.
Economists forecast that the data will show that unemployment continued to trend lower in November, with the jobless rate expected to fall from 8.8% to 8.7%, its lowest levels since 2008.
Meanwhile the Pound may come under pressure on Wednesday as analysts predict that the UK’s trade deficit will have risen in November.
However this could be offset by the accompanying production figures as British factory output is forecast to have risen over the same period.