Eurozone Inflation and GDP Figures Released
This morning the latest inflation data for the Eurozone has been released and has shown that it has held steady at 0.4% as expected which will be something of a relief to the European Central Bank (ECB) as it stops the rot and very slightly reduces the pressure on the ECB to act again in terms of preventing deflation. Also announced this morning were the latest set of Eurozone Gross Domestic Product (GDP) figures which showed a quarterly drop to 0% which brings them perilously close to being back in recession. Two quarters of negative growth is the official mark for an economy being in recession and so the ECB will on one hand be pleased to have avoided a negative number this quarter but it does leave the single currency economy open to weak figures at the end of this year. The Eurozone is under pressure economically at the moment and this is resulting in a weak Euro and therefore excellent opportunities for clients to buy Euros despite the drop we saw yesterday following the negative UK data.
UK Economy and GBP Exchange Rates
Yesterday was billed as being one of the most important for a long time for Sterling exchange rates and while the Bank of England were able to announce that unemployment is still falling and growth for the UK economy is better than expected but with wages not keeping in line with inflation a concerning gap between the price of goods and services and people’s wages is growing which is concerning the Bank of England. As a result the Pound weakened yesterday falling significantly against most the major currencies, especially the Euro and the Dollar. This means now previous expectations of a positive Sterling trend have been dashed and instead we could now see the Pound drop further which means for those clients looking to buy foreign currency it will be worth speaking with us today to discuss the market outlook in more detail and the options available to you.
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