August is now in full swing, and the European mainland in many areas embrace the summer months with numerous bank holidays, most of which are concentrated in the run-up to September.
Traditionally this month produces bizarre activity given that traders in European institutions are regularly forced to wait until the Tuesday of the following week before being able to react to movements and news from the weekend and the beginning of the week.
There is a very obvious excitement in the markets surrounding today’s economic sentiment survey for the Eurozone and a specific look at its powerhouse – Germany.
Growth data last week showed a marked slowing in Germany, but we may still see an increase in business confidence compared to last month in the immediate impact of the Brexit vote. Since then stress tests on European Banks have shown that most could withstand a financial crisis quite well, with the notable exceptions of Italy and Greece. Furthermore, the expectations of a measured and gradual approach to enacting Article 50 – now seemingly assessed in years rather than months – is calming much of the previous panic rife throughout Europe and not just the UK.
With the delay in European trading from Monday, good news could result in some exaggerated movements in the favour of Euro sellers this morning.
On Friday we will see the next key data release for the Eurozone with their own look at inflation changes during July. Due to the lack of business activity during this period mentioned above, despite the beneficial effects of rising prices during the summer months as foreign visitors flock to the mainland, this is expected to show a negative figure for July.
So overall markets are anticipating a mixed bag for the Euro this week, with some potential opportunities for buyers as we edge closer to the weekend. 1.15 was the bottom level GBP/EUR reached during last month. Since then we have just edged past this Euro sellers are now seeing opportunities to convert their funds into Sterling just over three year highs. Since the beginning of the month this is an improvement of almost £7000 on a €200,000 sale so Euro sellers may be wise to take advantage of any opportunities produced today.
For more information on how economic releases this week could impact your currency needs, call our trading floor on 01494 725 353.
Would not hesitate to use again, Joshua from FCD looked after us very well and we were able to get a good rate of exchange, the whole process was very quick and painless.
This was a faultless service from start to finish. Our contact, Joshua, could not have been more professional and efficient. He guided us excellently through all the stages of transferring money to the UK. Joshua even managed to get us the best exchange rate available at the time, and he did this with a pleasant manner and exceptional politeness.