Eurozone data to boost the Euro?

Unusually we have a very busy end to the month in terms of economic data for the Eurozone. We begin with this morning’s January Consumer Confidence data as well as Industrial Confidence. Both have started to improve recently and I think if the momentum carries on this could see GBP/EUR rates fall marginally. Later this afternoon at 1pm we also seen the release of the German Consumer Price Index, which is a measure of inflation and as the engine room of the Eurozone this will provide a key insight into how the Quantitative Easing has been working.

However, the real important data is all to be released tomorrow morning so if you have a pending currency transfer to make involving either buying or selling Euros this will be crucial to your decision. Tomorrow brings the release of three huge economic data announcement, which are usually a little more spread out.

Eurozone GDP data, Unemployment and Inflation figures are all published at the same time of 10am tomorrow morning. Whatever happens to the data the effect on the GBP/EUR rate is likely to be very noticeable. GDP is expected to rise and if inflation also shows an increase it will like with German inflation give support to the European Central Bank’s decision to extend QE last year.

Politics to affect GBP/EUR rates long term

During 2016 and so far this year GBP/EUR exchange rates have been dominated by what is happening politically and although tomorrow’s events are likely to affect exchange rates in the short term to either buy or sell Euros the Pound vs Euro rate will still be dominated by what happens politically in the months ahead.

With the UK’s plan to leave the European Union still stalling and with European elections due to begin in the next few weeks we are set for a turbulent time ahead. I personally think once Article 50 has been triggered then we’ll see the Pound gain vs the single currency as it means there will a more clear and arguably stable future.

With the Netherlands due to go to the polls on March 15th it appears as though there is an appetite for change. Therefore, if you’re considering selling Euros it may be worth taking advantage of the current rates of exchange and if you don’t have the full availability of funds it may be worth looking at buying a forward contract which allows you to fix an exchange rate for a future date.

If youd like to learn more about what is affecting the Euro, get in touch with our team today on 01494 725 353. Alternatively if you have a currency requirement and would like to learn more about what is affecting the markets, you can email me at teh@currencies.co.uk.

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