For a third day the Euro advanced on the Pound, and the common currency is likely to hold these gains overnight as investors look ahead to tomorrow’s UK Bank of England inflation report.
The Pound to Euro Exchange Rate is currently trading in the region of 1.1844 as of 15:10 GMT
While the Euro experienced only modest movement following the publication of inflation data for Germany, the common currency was able to advance by 0.6 per cent against Sterling following the release of UK inflation figures, taking its gain so far this week to 1.2 per cent.
The UK consumer price index surprised forecasts by advancing 2.2 per cent in October, year-on-year, rather than the 2.5 per cent expected. This was down from 2.7 per cent in September.
The UK retail price index gained by 2.7 per cent in October YoY. Economists had envisaged a gain of 3.0 per cent.
After the data was released London-based currency strategist David Bloom commented; ‘Interest-rate expectations are going to be pared back after the inflation data. This has put Sterling on the back foot.’
Similarly, economist Rob Carnell stated; ‘The inflation figures are helpful but they’re not by any stretch suggesting that we need to embark on another round of policy easing. The inflation picture is much worse here than it is in Europe. Today’s report may be just a flash in the pan’.
The GBP/EUR Exchange Rate hit a low of 1.1789
The Euro also recovered ground against the US Dollar during the European session.
In other Eurozone news, leaders from the 17-nation currency bloc gathered today in order to discuss the seemingly insurmountable challenge of reining in youth unemployment, which has hit record highs in many nations.
Across the Eurozone as a whole joblessness amongst the 16 -25 age group came in at 24.1 per cent in September.
In the words of economist Philip Shaw; ‘It really is a long haul. The most one can hope for is a set of constructive talks.’
A press conference is due to take place after the meeting concludes.
Tomorrow Euro movement could be inspired by Eurozone industrial production data. However, if UK employment figures advance as forecast the Pound may recoup recent losses against its European cousin.
Economists have forecast that the UK economy added 93,000 positions in the three months to September, with the unemployment rate holding at 7.7 per cent.
Of course the Bank of England’s inflation report will also impact the EUR/GBP pairing.
Current Euro (EUR) Exchange Rates
< Lower > Higher
The Euro/US Dollar Exchange Rate is currently in the region of: 1.3437 >
The Euro/Pound Sterling Exchange Rate is currently in the region of: 0.8443 >
The Euro/Australian Dollar Exchange Rate is currently in the region of: 1.4410 >
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.6332 >
The US Dollar/Euro Exchange Rate is currently in the region of: 0.7444 <
The Pound Sterling /Euro Exchange Rate is currently in the region of: 1.1844 <
The Australian Dollar/Euro Exchange Rate is currently in the region of: 0.6939 <
The New Zealand Dollar/Euro Exchange Rate is currently in the region of: 0.6125 <
(Correct as of 15:10 GMT)
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