GBP/EUR Exchange Rate Rangebound as Eurozone Unemployment Figures Hit 10-Year Low
The Pound Sterling Euro (GBP/EUR) exchange rate has been static over the course of the morning, and is currently sitting at interbank rates of €1.1119.
The Euro found support on the back of better-than-expected unemployment figures, with the Eurozone seeing a decrease in unemployment.
Unemployment currently stands at 7.9%, a 10-year low, falling from the previously revised figure of 8%, despite the figure in Italy not falling as far as expected in November.
Seasonally adjusted German trade balance figures for November showed it had increased to a higher-than-expected €19B from €17.9B, although both German import and export figures declined in November which did little to aid the Euro as it briefly fell against the Pound.
Yesterday: GBP/EUR Exchange Rate Falls despite Better-than-Expected UK House Sales
Yesterday saw the Pound slump against the Euro over the course of the session as MP returned to Parliament to resume their discussions of the Brexit Withdrawal Agreement.
Increasing house sales in the UK did little to stop the Pound from falling against the Euro over the course of yesterday’s session.
Halifax reported house prices growing by 1.3% in November over the course of a year, although the mortgage lender cautioned against reading too much into the strength of these figures.
GBP/EUR Exchange Rate Falls despite Low Eurozone Business Climate Figures
Despite some disappointing data releases from the Eurozone the Euro rose against the Pound over the course of the session on Tuesday.
Business climate figures for the Eurozone fell further than forecast, from 1.04 to 0.82, as industrial confidence fell to a lower-than-forecast 1.1 from 3.4.
While consumer confidence in December remained low services sentiment for December fell to 12.0 from the previously revised 13.4.
These weak data releases however did little to aid the Pound, with the Euro making gains on the UK currency throughout the day.
Outlook: GBP/EUR Exchange Rate could Fall Further on Brexit Pessimism
This afternoon will see a speech from the Bank of England’s (BoE) Governor, Mark Carney; if his tone is dovish it is likely to cause Sterling to continue to weaken against the single currency.
Tomorrow morning will see the release of the BoE’s credit conditions survey report, which may also cause some movement in the Pound.
The European Central Bank’s monetary policy meeting accounts are also set to be released tomorrow, which could mean the Euro continues to make gains on the Pound if the report has a bullish tone.
With the Brexit parliamentary debate continuing, it seems likely that this will remain the main catalyst for movement within the pairing leading up to the ‘meaningful vote’ on 15 January.