With the Eurozone economy remaining strong, this Euro report looks at what's ahead for Euro exchange rates. In the table below you’ll see high to low GBP/EUR exchange rate movement when exchanging £200,000 to Euros on Friday.
|Currency Pair||% Change||Difference on £200,000|
The Eurozone has benefited from a very strong period of growth. Some of the best levels in over a decade. The European Central Bank (ECB) have already said there is the strong possibility of an end to their Quantitative Easing (QE) program.
QE is where money is pumped into an economy in order to stimulate growth. Money is currently going in €30bn increments per month. Although a cut is to some extent factored in, firm news on the cut will likely be beneficial to the Euro.
The resilience of the Euro has been demonstrated recently when there was very little fall in the Euro’s value even though there was political uncertainty in both Germany and Italy following their elections.
This was also demonstrated last week when despite news of a probable rate hike by the Bank of England and access being granted to the single market for the UK during the transitional deal GBP/EUR failed to stay above 1.15.
If I was selling the Euro and buying Sterling however, I would not be hanging on for below 1.12. I am of the opinion the Pound is chronically undervalued and should there be firm progress in Brexit talks we could see substantial gains for Sterling. I would be looking to move short term.
There is little data releases this week that I think have the potential to cause significant movement for the Euro. The pick of the bunch would be German Consumer Price Index (CPI) data on Thursday. CPI is a measure of inflation and can influence monetary policy. Inflation has been a problem in the Eurozone for some time and is one of the main reasons holding back the ECB from hiking rates. Despite Germany being the engine room of the bloc, I don’t think this will cause any great shakes.
Thank you for reading my Euro currency 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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