The Pound (GBP) has traded in a narrow range against the Euro (EUR) this afternoon, following the release of Eurozone consumer confidence data.
An initial estimate for July has printed at -0.6 points, which wasn’t as bad as the expected -0.7 point outcome.
Looking at the data in an optimistic light, ING economists said:
‘Ahead of the European Central Bank (ECB) meeting on Thursday, the governing council is looking for clues on whether the Eurozone is going through a soft patch or a downswing.
‘This release ticks the “soft patch” box, as did the industrial production data released last week.
(Last updated 23rd July, 2018)
Will Rising UK Business Confidence Push GBP/EUR Exchange Rate Higher?
The Pound (GBP) has made a minor advance against the Euro (EUR) today, ahead of potentially greater gains on Confederation of British Industry (CBI) data.
Out on Tuesday, the CBI’s ecostats will cover a measure of business optimism during Q3 2018, as well as industrial orders figures for July.
Higher business optimism is forecast, which could boost the GBP/EUR exchange rate. That said, reported levels of industrial orders are expected to decline slightly.
Lining up a potential two-one split of negative news, Wednesday’s CBI distributive trades reading is also predicted to show a decline during July.
It is worth noting that these outcomes are not set in stone – if all three readings print positively then the GBP/EUR exchange rate could see an early to mid-week rise.
Future GBP/EUR Exchange Rate Forecast: Are Pound Sterling Losses ahead on Consumer Confidence Stats?
The Pound (GBP) is at risk of declining against the Euro (EUR) in the coming week, when UK consumer confidence data is released on 31st July.
This end-of-month data could cause the Pound to Euro exchange rate to decline, should it show an as-expected drop during July.
Lower consumer confidence could signify continued uncertainty about the state of Brexit negotiations, which have remained stalled for several months.
The GfK consumer confidence reading previously printed negatively at -9 points, but the current expectation is for a shift further down to -10.
Euro to Pound Exchange Rate Forecast: Will EUR/GBP Rate Fall Further on Consumer Confidence Dip?
Like the UK, there is a Eurozone consumer confidence reading on the horizon and in another similarity, this is predicted to worsen.
This afternoon’s July Eurozone consumer confidence flash is only an estimate figure, but is still tipped to shift from -0.5 points to -0.7 or -1.3.
Lower consumer confidence risks reduced spending and investment, which can cause slower economic activity across the single currency bloc.
The Euro might dip if the consumer confidence estimate prints as predicted, although the reading could also boost the EUR/GBP rate if it shows surprise improvement.
Euro to Pound Exchange Rate Forecast: Is EUR/GBP Turbulence ahead on Eurozone PMI Data?
Although EUR/GBP exchange rate losses could come later today, the Euro (EUR) might still be able to advance against the Pound (GBP) on Tuesday morning.
There will be a range of high-impact Eurozone PMI readings released on the day, covering French, German and overall Eurozone activity.
The main stats to watch out for are the German and Eurozone readings; slower German activity is forecast alongside lower Eurozone activity measurements.
As with today’s confidence reading, these are only flash figures which might end up boosting the Euro if they miss forecasts and show growth in July.
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