This Euro report will examine the factors that could affect exchange rates this week in order to help you stay informed if you need to make a currency transfer. The table below shows the difference you would have received when buying £200,000 at the high compared to the low for the past month. To keep track of Euro rates visit our live exchange rates page.
|Currency Pair||% Change||Difference on £200,000|
Euro rates have taken a stumble throughout September, especially against the Pound. The multi-month highs selling euros at the beginning of the month now seems like a distant memory following a positive month for the Pound.
I don’t expect to see the better levels for Euro sellers to return in the near future after some fundamental changes in fortune for the UK pound.
The EURGBP is now towards the worst level seen for three months and personally I see any change in fortune to be a short-term opportunity rather than a long-term trend.
The major reason for the Euro’s change in fortune is political with the German elections last weekend. Angela Merkel won a majority as widely expected, a coalition government needs to be formed as usual in Germany however the surprise was that their normal partners, the Social Democratic Party (SPD) has said they want to become the main opposition party rather than helping form a government. This change has weakened the EURO as the power house of Germany’s future and political focus are rather unknowns as new political parties will likely become involved in the new government. What I would say however, is that steps towards this new government being formed are likely to be seen as positive and could strengthen the Euro as a result.
Economically, the Eurozone is still performing very well. Euro area consumer confidence hit a 16-year high only recently and most expect this improving picture for the euro zone to continue. Later today industrial confidence is released along with German consumer data – both are expected to show an improvement probably making the euro more valuable and therefore more expensive to buy. Consumer Price Index for the EU is released tomorrow morning and this too is expected to result in further Euro strength.
Personally, I expect the euro to end the week stronger than it sits this morning. As a result, if you are a GBPEUR trader you may wish to take advantage of these current highs quickly. Euro sellers however may wish to wait until Friday afternoon in the hope of better levels. Longer term I expect GBPEUR rates to actually fall, Lloyds have recently updated their forecasts for the end of the year to 1.12 so 2 cents lower than where they are now.
Thank you for reading my Euro currency report, if you have any questions about an upcoming transfer I would be more than happy to discuss them – you can contact me with any queries on 01494 725 353 or email me here.
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