This report looks at news that the EU economy grew at its fastest for 10 years with the 28 countries within the bloc growing by 2.5% in 2017 which was the fastest since 2007. What does this mean for Euro exchange rates?
In the table below you’ll find high to low GBP/EUR exchange rate movement and the difference when exchanging £200,000 to Euros in the last two weeks:
|Currency Pair||% Change||Difference on £200,000|
Considering the continuous flurry of positive data last week and the high levels of both business and consumer confidence it’s unsurprising that the record was broken. Much of the growth has been driven by the four core economies: Germany, France, Italy and Spain with Italy having their first year of significant growth in some time following the bailout packages. The huge amount of quantitative easing being pumped into the economy has now doubt been a major factor to helping boost conditions. This has resulted in rising wages and low inflation which in turn has helped to drive consumer spending. This year the Eurozone is expected to continue to strengthen as global growth is forecast at 4% which should mean European exports will be sought after throughout the year. Considering last year and the optimism for this year it seems unlikely that without a political or major event taking place the Euro in the short term should remain strong.
Leader of the European Union Juncker yesterday in a press conference rubbished claimed by Boris Johnson that he is trying to make a super state within the EU. Juncker said that “we’re not the United States of America but a rich body of 28 nations”. Furthermore directly aiming comments at Boris Johnson in particular he suggested that “some in the British political society are against the truth, pretending that I am a stupid, stubborn federalist”. The comments from Juncker are certainly those of frustration and are unlikely to improve his opinions of Britain in Brexit negotiations.
On Friday the Prime Minister will meet with the leader of Germany Angela Merkel to hold crunch talks on Brexit. Angela Merkel is currently in a tough position as she tries to form a coalition in Germany, whilst other countries express their anger at Michel Barnier’s approach. May could attempt to get the other hand by building relationships with other EU leaders essentially putting pressure on the EU and their negotiating team.
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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