A fall in factory orders from Germany added to the Euro's woes, with disappointing inflation data and retail sales figures also adding pressure pressure. The table below shows the difference in Euros you would have achieved when buying £200,000.00 during the high and low points of the past 30 days.
|Currency Pair||% Change||Difference on £200,000|
Despite a slight recovery from the Euro during yesterday’s trading, weak inflation data and frail retail sales figures from across the bloc were added to the long list of fairly disappointing readings for the Eurozone so far this year.
This was further compounded by a surprising fall in factory orders (from 8.2% to 3.2% year on year) by Europe’s major player Germany, leading investors to begin to question European growth prospects moving forward.
Timing is everything in the currency markets and there does now seem to be a sense of a shift in momentum. Last year’s impressive gains for the Euro were all prompted by the solid foundation of it’s economy systematically posting positive release after positive release. Now that that consistency seems to have waivered, the pressure will be mounting on the European central bank to make its position clear regarding its plan to scale down its monetary stimulus.
Personally, I see this as an excellent opportunity for those looking to buy Euros with Sterling to capitalise on the current uncertainty surrounding the Eurozone, moments that have certainly been few and far between since the Brexit vote.
I think the terrible weather the whole of Europe has faced over the last couple of months may have skewed forecasts somewhat and expect to see a return to the status quo for April’s readings which in turn should keep the ECB on track with their revaluation of their quantitative easing program. I believe the very positive Services readings for both France and Spain posted yesterday morning showed there is still plenty of margin for growth.
This may well be reflected in the European Sentix investor confidence release early next Monday morning, which will provide a strong indication as to how leading analysts believe the Eurozone’s growth prospects are shaping up. As a result, if you have a Euro requirement it may pay to get in touch with your account manager before the week comes to an end.
For more information on how future data releases could affect your currency requirement, call our trading floor on 01494 725 353 or email me here.
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