Pound Euro (GBP/EUR) Exchange Rate Muted as Ahead of Debate No-Deal Prevention Legislation
The Pound Sterling Euro (GBP/EUR) exchange rate remained flat and the pairing is currently trading at an inter-bank rate of €1.1242.
Investors continued to fret about a Eurosceptic Conservative Prime Minister setting the country on course for a no-deal Brexit.
Frontrunner Boris Johnson stated he would be willing to take the UK out of the European Union on 31 October with or without a deal.
However, the Labour Party have stated it would attempt to introduce legislation to prevent a no-deal Brexit.
Later today the opposition party will debate a motion to give MPs the chance to introduce legislation preventing a no-deal.
Commenting on this, Blonde Money Strategist, Helen Thomas said:
‘With the risk of a new leader with a new mandate behind a more unified Conservative Party, the opposition must make hay with mayhem while they can. By forcing this issue today, candidates must clarify where they stand on Brexit.’
Euro (EUR) Flat as Global Headwinds Continue to Batter the Bloc
Meanwhile, President of the European Central Bank (ECB) gave a welcome address in which he discussed headwinds to the single currency.
President Mario Draghi highlighted that growth in the Eurozone had slowed, and stated:
‘Global trade has faced headwinds in recent years as trade-restrictive measures have outpaced liberalising measures.’
However, the single currency continued to remain flat against Sterling.
Also on Wednesday, Vice-President of the European Central Bank (ECB), Luis de Guindos gave a speech focusing on the Eurozone’s economy and the bank’s monetary policy stance.
In his speech he highlights that the better than expected data for the first quarter was largely due to temporary factors as ‘global headwinds continue to weigh on the Euro area outlook.’
Discussing monetary policy, de Guindos said:
‘Overall, we are confident that the monetary policy measures will provide the monetary accommodation necessary for inflation to remain on a sustained path towards levels that are below, but close to, 2% over the medium term.
‘At the same time, we remain alert in the wake of mounting global uncertainties. The Governing Council is, therefore, determined to act in case of adverse contingencies and also stands ready to adjust all of its instruments, as appropriate, to ensure that inflation continues to move towards the Governing Council’s inflation aim in a sustained manner.’
Pound Euro Outlook: Will Disappointing Eurozone Industrial Production Weigh on EUR?
Looking ahead to Thursday morning the Euro (EUR) could rise against Sterling (GBP) following the release of the German Harmonized Index of Consumer Prices.
If inflation rises higher than forecast in May, the single currency could receive an upswing in support.
Meanwhile, the Euro could slide following the release of April’s Eurozone industrial production data.
If industrial production slumps for the third consecutive month, the Pound Euro (GBP/EUR) exchange rate could rise.