The Euro continues to be under pressure, as political uncertainty in Italy remains unresolved. The Euro report below looks at how this, and other factors could impact the single currency in the coming weeks and months. The table below shows the difference in Euros you could have achieved when buying £200,000.00 during the high and low points of the past week.

Currency Pair% ChangeDifference on £200,000
German data expected to show improvement in economy

Yesterday, the Euro ended the day down almost 0.13% against sterling, likely linked to the UK data set to be released this week and depending on the actual outcomes, bullish figures would suggest further woes for the Euro.

Despite this, the Euro could be in for some positive movement following tomorrows German and Eurozone Manufacturing, Services, and Composite Markit Purchasing Managers’ Index (PMI) releases.  

The Purchasing Managers Index (PMI) released by the Markit Economics is an indicator of business conditions in the associated business sectors with any reading above 50 signalling expansion, whilst a reading under 50 indicating a contraction.

On Thursday, the European Central Bank (ECB) will publish the 4th set of Monetary Policy Meeting Accounts for 2018 which contain an overview of financial market, economic and monetary developments.

The release will also provide more detail on the discussions that led to the decision to keep interest rates on hold last month so depending on how the information is delivered the Euro could gain some strength.

Italian politics causing friction

The current complex political situation in Italy is only adding further pressures on the Euro.

The main concern for markets is that the coalition's plan is to radically increase public spending whilst at the same time cut taxes, despite the country already having the second largest public debt burden in the Eurozone, of 130% of GDP - second only to Greece.

Currency forecasts and analyst alike, are rarely looking at this political development with a positive outlook, with Luca Mezzomo, the head of macroeconomic analysis at Italian lender, Intesa Sanpaolo suggesting the EUR could see weaknesses by as much as 2 cents against the USD due to the brewing political risks which threaten to destabilise the integrity of the Eurozone.

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.