The European Central Bank are due to release their latest meeting minutes today, with insight into future monetary policy plans. The Euro report below looks at how this could impact the Euro, taking into account the current political uncertainty within Italy. The table below shows the difference in Euros you could have achieved when buying £200,000.00 during the high and low points during trading yesterday.

Currency Pair% ChangeDifference on £200,000

EU Weakness after Weaker Manufacturing Data

The Euro has slipped lower following weaker than expected EU manufacturing and services data as per the Purchasing Managers Index (PMI). Whilst the sectors showed expansion in both sectors the numbers were noticeably lower than expected causing some concern as to how well the economy is performing. Manufacturing arrived at 55.5 which although healthy was some way off the 56 figure expected and the same was true for services.

The European Central Bank (ECB) release their Monetary Policy Meeting accounts this morning at 11:30 and could create some volatility for Euro exchange rates. The data contains an overview of the financial markets and economic developments which will help to shape the course of action from the ECB. Any new developments here that hint to an adjustment on when the ECB will end the taper of its asset purchasing scheme should see a reaction for the Euro.

European Stimulus Package Agreed

Euro Uncertain after Italian Election

The Euro has come under some pressure following the Italian elections with the formation of an anti-establishment government. Italy’s new leaders seek to shake up the system with higher government spending and lower taxes, all of which clash with guidelines set by the EU. Matteo Salvini the leader of the League has stated “I didn’t ask for votes to continue on a path of poverty, precariousness and immigration: Italians first!” Whether or not Italy breaks the rules remains to be seen but clients should remember the weakness seen in the Euro in 2015 when the Greek crisis was at its peak and rates for GBP EUR were up at 1.45. The issue for Italy still remains that the level of public debt is excessively high at €2.3 trillion which is the most for any EU state.

For the moment Italy relies on support from the European Central Bank (ECB) and any divergence from Italy could lose support from the ECB. So far the market reaction for the Euro has been limited at this early stage but expect many more developments as events unfold. An Italexit cannot be ruled out and this would be much more severe for the Euro than the Grexit that never actually happened.

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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Exchange rates on this page are interbank rates and indicate where the market is trading to show the performance of a currency pair. They are not indicative of the rates which we offer. The information on this web site is provided free of charge for information purposes only. It does not constitute advice to any person on any matter. Foreign Currency Direct plc. ("FCD") makes every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to the same.