Pound Sterling continues to slide, days before the EU referendum. The ECB's rate cuts in March should start to boost Euro inflation shortly but as of yet, it has had limited impact. Swings of 5.4% in the last 30 days have been highlighted. You can view live exchange rates at any time from our live exchange rates page.
With just 9 days until the UK’s referendum on whether or not to remain in the EU, this has been the key driver on GBP/EUR exchange rates over the past few weeks and I believe that this will continue as we edger closer to June 23rd. The Euro hit its strongest levels against the Pound since the beginning of April during yesterday’s trading and as we have drawn closer to the referendum, we have seen the single currency gain by 5% against Sterling.
This has presented an excellent opportunity for Euro sellers to take advantage of and means that in the space of 14 days a €150,000 repatriation in to GBP could have gained you an extra £6,000. We could see further improvements for Euro sellers over the next few days, but if there is a vote to remain in the EU on the 23rd then we could see these gains quickly reversed. I believe the vote will be incredibly close judging by the recent polls I have read over the weekend, and would urge clients to have a strategy in place to protect themselves from any adverse market movement.
This morning there is a chance for the Euro to bolster its position against the Pound, with Industrial Production figures for April set to show an improvement in both year on year and month on month figures. Furthermore, on Thursday morning the ECB will release Eurozone inflation figures for May. The ECB announced rate cuts and a boost in QE in March, so will be hoping to see a rise in inflation as a sign that their stimulus measures are working.
There is expected to be a rise in inflation for May compared to April, so I believe that investors will view this as a sign that the recent measures are beginning to have the desired effect, and therefore it is likely we will see further Euro strength.
Do you have Euros to sell? Now could be a good opportunity to take advantage of the EU referendum. Call our trading floor on 01494 725 353 or email me here for a quote.
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