This Euro exchange rate update examines factors that could affect EUR exchange rates this week. In the table below you’ll see high to low GBP/EUR exchange rate movement when exchanging £200,000 to Euros in the last 24 hours.
|Currency Pair||% Change||Difference on £200,000|
At the start of the week UK and EU officials met in Brussels to begin Brexit negotiations. No surprise at the first meeting the major talking point was whether the divorce settlement negotiations (the amount the UK will have to pay to leave the EU) would run alongside trade relationship negotiations.
Before this week started Brexit Secretary David Davis had exclaimed, "you can’t decide one without the other" and Theresa May when triggering Article 50 last year stated, "we believe it is necessary to agree the terms of our future partnership alongside those of our withdrawal from the EU". However after 2 days of negotiations the UK officials have backed tracked and agreed to discuss the divorce settlement before a new trade deal.
With Theresa May not winning a majority and therefore weakening her position as Prime Minister I wouldn’t be surprised to see the PM and UK officials continue to back track in the weeks and months to come. For example David Davis in the past has stated he doesn’t believe the UK should pay a penny to exit the EU. However in the upcoming months to start the trade deal negotiations
I believe both parties will come to a compromise and a deal will be struck.
In regards to currency, GBP/EUR exchange rates could go either way due to the Brexit negotiations.
I expect the Pound to continue to devalue in the short term however if a softer approach takes place I believe this could be good news for Brits that are purchasing a foreign currency in the future, as the UK could still form a deal with the EU to trade within the single market. However, once UK/EU trade negotiations eventually begin a major talking point will be the free movement of people and I believe this is something the Prime Minister cannot give up. No one said these negotiations would be easy for either party.
Thursday afternoon the European commission release their latest Consumer confidence numbers. The number is set to be released at -3.3% and a low number is seen as negative. However if the number is released at -3.3% I would expect this to actually give a small boost to the Euro. My reasoning for this is that the last release was -3.6% and consumer confidence would have continued to rise steady for the last year, as consumer confidence was -7.0% only 12 months ago.
Thank you for reading my Euro report, if you have any questions about Euro exchange rates I would be more than happy to discuss them – you can contact me with any queries at firstname.lastname@example.org.
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