Getting the best exchange rate can be achieved by understanding what is driving rates and the service of a specialist currency broker. Below are movements in just a month affecting Pound Sterling rates when buying £200,000:

Currency Pair% ChangeDifference on £200,000
GBPEUR3.5%€7,350

EURO remains under pressure

The Euro has recently been under quite a bit of downward pressure and has fallen from grace. Last week we saw two rather large events which have resulted in this fall.

ECB extending QE is a bad sign for EURO sellers

Firstly we had the latest decision from the European Central Bank (ECB), when they cut the level of QE they are planning to do moving forward from the previous €60B a month to €30B. This was widely expected and in itself would have resulted in some considerable strength as it shows a good indication that the health of the European economy is on the mend. Thereafter however the head of the ECB extended the whole program by a further 18 months as a minimum. This had the reverse effect on the Euro as it highlights that the ECB, with all the information that they have access too, believe the Euro is still not out of the woods. This QE discussion will be a long term story which could continue to pin the Euro’s value down.

Catalonia’s vote key concern for Euro holders

The situation in Catalonia – why is it weakening the Euro?

The second event was the developments in Catalonia and their claim of independence.

This story will continue to have a weakening effect on the Euro as it unravels, and the impact on the Spanish economy could be significant due to the tourist revenues lost. Spanish Industrial output is due on Wednesday next week and with the region being a big contributor to that sector we could well see a further weakening at that event.

Personally I see this story as more symbolic rather than economically damaging to the EU.

If they were to leave, and there has already been talk of a Catalonia Cryptocurrency being created, it would take a long time and they would be unlikely to leave the EURO. However, it could have a domino effect, with other regions in Italy, Germany and Poland all asking for independence. This is the much larger impact if this story develops and could continue to have a negative impact on the value of the EURO making it cheaper to buy.

BoE news results in GBPEUR fall

Buying Sterling today is nearly 2 cents lower than it was earlier this week and this can be firmly put on the news from the Bank of England yesterday. They raised rates but suggested future interest rate hikes would be at a considerable slower pace than previously expected.

GBPEUR rates for the next 7 days

Next week we have a host of data due from Europe including their Eurogroup meeting on Monday, along with PMI data. On Tuesday we have Retail figures and on Wednesday there is the next ECB meeting.

If you would like assistance with the timing of your particular situation please feel free to get in contact.

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 on 01494 725 353 or email me here.

News

Read more articles
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.