The EUR has seen its value increase against GBP and the USD over recent days, despite some potentially worrying signs emanating from the Eurozone and its economy. More on the political uncertainty from within the bloc and globally in the market report below, with the table showing the difference in GBPEUR exchange rates during the high and low trading points for the past month.
|Currency Pair||% Change||Difference on £200,000|
GBP/EUR rates have moved back below 1.12, following what seems like a complete stalemate in the current Brexit negotiations. This has inadvertently helped drive the EUR value higher by sapping confidence in Sterling, causing investors to sell off their GBP currency positions, thus weakening its value.
EUR/USD rates have also spiked, with the single currency making inroads towards 1.18 against the greenback during Tuesday’s trading.
These positive moves against two of the world's most traded currencies have come despite a drop in Eurozone exports, which in turn has driven a slowdown in the Eurozone economy.
Manufacturing PMI figures fell to a four-month low of 54.2 in September, down from 54.5 in August.
Business Confidence figures have also fallen, due to “a near stagnation of exports” according to data firm IHS Markit.
An escalating trade war between the US and EU, political uncertainty inside the Eurozone and Brexit have all been cited as the key reasons for the slowdown.
This current negative perception is at odds with the general consensus last month, when economic data indicated that the Eurozone economy was navigating the potential pitfalls above without any major downturn.
This goes to show how quickly market perception can change. The EU is not immune to the current Brexit saga and separation from the UK is likely to negatively impact the EU economy as well as the UK’s. This has not been focused on for the most part by the UK media but it is a reality that the EU cannot escape.
Add to this even more pressing concerns regarding the trade tariffs implemented by President Trump, and the knock on effects this could have on the medium to longer-term economic growth inside the Eurozone.
Whilst market conditions can change quickly, I would be very tempted to take advantage of the recent spike in value and avoid the potential pitfalls lying ahead.
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.
From the initial contact with the broker, through my dealings with the compliance folk, the experience was the same, a great blend of efficiency and friendliness, plus I got a great rate, well done Matt and the team.
Matt and Jonathan were excellent and most professional. Through out I felt I was in good hands – they took time to explain everything to me and were very patient when I was experiencing some technical problem with my own bank.
Matt was very helpful and efficient, very good service.